Frankfurt (AFP) – German sportswear group Adidas on Thursday reported a jump in third-quarter profits, lifted by a surge in sales of its own-brand trainers and apparel.
The Bavarian company, which sponsors English Premier League giants Manchester United, also confirmed its improved outlook for the year, bolstered by high-profile sponsorships during the Euro 2016 football tournament and the Rio Olympics, as well as collaborations with big names like Kanye West.
“2016 will be a record year for the Adidas group with truly exceptional results,” new chief executive Karsten Rorsted, who took the helm on October 1, said in a statement.
For the July to September period, the group’s net profit soared by 24 percent to 386 million euros ($428 million) compared to the same period a year earlier.
Group revenues grew by 14 percent to 5.4 billion euros.
The Adidas brand itself, famed for its three-striped logo, saw global sales jump 20 percent, driven by strong demand for its retro-inspired adidas Originals trainers and its adidas neo urban fashion line.
Sales of its Reebok brand were up seven percent.
Both brands did particularly well in China and the United States, allowing the Adidas group to gain ground on its main rival Nike.
Looking ahead, the group warned that it would see “one-time costs” in the second half of 2016 related to restructuring measures at Reebok and investments aimed at “strengthening the group’s growth foundation”.
But it said it was still on track to meet the improved forecast announced in July, expecting “revenues to increase at a rate in the high teens” in 2016.
Net income this year is forecast to soar by 35 to 39 percent to between 975 million euros and 1 billion euros, it added.
Despite the good news, Adidas shares fell by more than five percent to 139.10 euros in early morning trading in Frankfurt.
For the first time in several earning seasons, “Adidas’s reported quarterly numbers did not beat market expectations”, DZ Bank analyst Herbert Sturm said.
“This could cause some short term profit taking on the stock.”
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