Apparel Online India Magazine June 1st Issue 2018 | Page 13

RETAIL CURRENT
Adidas makes dent in Under Armour's
North America revenue; posts 21% surge
Adidas, the Germany-based
sportswear company, has
announced the financial results
of the first quarter of the current
fiscal. “The first quarter results
are as per our expectations. North
America, Greater China and
e-commerce were strategic focus
areas for the company,” stated
CEO Kasper Rorsted. During
the quarter under review, the
sportswear retailer’s revenues
grew by 10 per cent on currency-
neutral basis and 2 per cent in
euro terms.
Adidas’ operating margin
increased by 1.8 percentage
points to 13.4 per cent in the
reporting quarter. Its operating
profit increased by 17 per cent to
¤ 746 million as compared to ¤ 637
million in the same quarter last
year. Net income from continuing
operations in the quarter under
review was up 17 per cent to ¤ 542
million from ¤ 462 million in the
same quarter in last fiscal. From
a market segment perspective,
on a currency-neutral basis, the
combined sales of the Adidas
and Reebok brands grew in
most market segments. In North
America, the company reported
a 21 per cent increase in growth
followed by Asia-Pacific with 15
per cent. 26 per cent increase in
Greater China majorly contributed
to growth in Asia-Pacific region.
Notably, the revenues remained
relatively flat in North America for
Under Armour in the first quarter.
Latin America and Western Europe
reported growth of 10 and 5 per
cent, respectively. The challenging
market conditions led to a decline
in sales in the emerging markets
such as Russia/CIS. The sports
retailer, which has been facing a
tough time in the past few years,
has now started returning to form.
In the last quarter of fiscal 2017,
it reported a 19 per cent increase
in revenue on a currency-neutral
basis. Adidas is facing a tough
The sports retailer,
which has been
facing a tough time
in the past few
years, has now
started returning
to form. In the last
quarter of fiscal
2017, it reported a
19 per cent increase
in revenue on a
currency-neutral
basis.
competition from Nike and Under
Armour, which reported a 6 per
cent increase in first quarter
revenue to US $ 1.2 billion. The
German retailer now expects to
note around 10 per cent increase
in sales on a currency-neutral
basis in the coming months. North
America and Asia-Pacific have been
projected as major growth drivers.
Net income from continuing
operations is projected to increase
to a level between ¤ 1.615 billion
and ¤ 1.675 billion. It remains to
be seen how Adidas maintains its
growth rate to compete against the
likes of Nike and Under Armour,
which has been rapidly eating on
Adidas’ sports market in the US.
www.apparelresources.com | JUNE 1-15, 2018 | Apparel Online India
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