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Corporate Reports

Adidas pummeled after profit warning

A day after Adidas had warned on its 2013 profit outlook, shares in German sports apparel maker were among the biggest losers in European stock markets. Adidas has been hampered by a strong euro and problems in Russia.

At the Frankfurt Stock Exchange Friday, shares in Adidas nosedived more than 5 percent to about 77 euros ($104) as investors sold their holdings following a profit warning.

After stock markets had closed on September 19, the German sportswear giant announced it was expecting to earn between 820 million euros and 850 million euros this year, which was up to 70 million euros less than previously forecast.

Revenue would also be less than expected, Adidas said, and operative margins were likely to drop from 9 percent to 8.5 percent.

Adidas attributed the fall in earnings to the strong euro in comparison with the currencies in its main markets, and distribution problems in Russia.

In Russia, an unexpected deliveries' bottleneck had emerged in the firm's newly-built distribution center near Moscow, substantially slowing sales in the firm's third biggest market, Adidas said in a statement.

Both the distribution problems and the adverse currency conditions had affected earnings mainly in the third quarter of 2013, Adidas added, expressing the hope that fourth-quarter results would develop more positively.

For Adidas long-term goals until 2015, the company's CEO Herbert Hainer remained optimistic, announcing that the post of a global sales manager would be installed in the company's executive.

uhe/dr (dpa, Reuters)