Despite some setbacks, Adidas managed to raise its turnover and profit sharply in the past quarter. The German sportswear company is therefore raising its expectations for the full financial year.
Difficult circumstances
Reported sales rose 51 % to 5.08 billion euros between April and June. With the exception of Greater China, where sales dropped 16 %, revenues rose strongly in all regions. For the weaker performance in the Asian region, Adidas refers to the geopolitical situation and new Covid restrictions that were imposed.
Due to the relaxations of measures elsewhere in the world, sales in the company’s own physical stores and those of other retailers rose sharply. Conversely, the e-commerce channel saw a 14 % drop in sales. Adidas also managed to sell more products at full price, which comfortably compensated for the higher raw material costs.
Operating profit in the second quarter was 543 million euros, up from minus 263 million in the same period last year. According to Adidas, the profit margin is now almost back to pre-pandemic levels. During the first half of the year, revenues increased by 34 % to 10.35 billion euros. The operating result rose to 1.25 billion euros, last year there was still a loss of 215 million euros.
Adidas has adjusted its forecasts upwards and now expects a 20 % increase in sales for the full year (at constant currency). The company expects a lot from a series of new product launches, and there are also some major sporting events coming up, including the Olympic Games in Japan. Adidas expects a net profit of 1.4 to 1.5 billion euros. Up until now, the German company has been expecting a net profit of between 1.25 and 1.45 billion euros.
