Adidas Is Hit Hard By Emerging Market Exchange Rate, 2014 Earnings Warning

P, the second largest sporting goods manufacturer in the world, AdidasAG (ADS.DE) Adidas group today warned that sales in the 2014 fiscal year will be hit by the weakness of the "a href=" //www.sjfzxm.com/news/index_c.asp "emerging market" /a "exchange rate weakness", such as Russia and Argentina, which will make it difficult for the sporting world Brazil world cup to offset its impact. < /p >
< p > group forecasts that net profit in the 2014 fiscal year will be 8.3-9.3 billion euros, which is 17% lower than the average forecast of 1 billion euro by 30 analysts of Bloomberg composite. AdidasAG (ADS.DE) chief financial officer of Adidas, RobinStalker, said in an analyst meeting after the earnings report that she did not rule out selective increases in prices to make up for it. But the expansion of the world cup and emerging markets and expansion of retail business will drive year-round sales to achieve high single digit growth (fixed exchange rate), an ideal growth rate of 3% over the 2013 fiscal year. < /p >
Less than P, Russia sold more than $1 billion last year to AdidasAG (ADS.DE) Adidas, which is one of the main growth markets of the group. The group's performance in the local market has dropped significantly from the largest competitor NikeInc. (NYSE:NIKE) < a href= "//www.sjfzxm.com/news/index_c.asp" > Nike < /a > group. But the euro rose 24% against the rupee last year. Russia is also likely to declare war against Ukraine. Fortunately, sales in the first two months of this year were not affected by the Ukraine situation. But if the situation worsens, consumer sentiment may be hurt, but chief financial officer RobinStalker also said he did not consider withdrawing any market because of exchange rate problems. < /p >
< p > analyst said that due to AdidasAG (ADS.DE) Adidas group's performance target far below market expectations this year, its share price will be depressed in the short term. AdidasAG (ADS.DE) reported 81.13 euros late Wednesday, down 2.72%. The stock market has fallen 10% this year due to exchange rate shocks in emerging markets, making it the worst performing blue chip stock in Germany. < /p >
In the past 2013 fiscal year, < a href= "//www.sjfzxm.com/news/index_c.asp" > Adidas < /a > AG (ADS.DE), the total sales volume of Adidas group in the fourth quarter of November 30, 2013 reached 3 billion 480 million euros, reaching the highest value of the analyst's expected interval, an increase of 3.3% over the same period last year, excluding the increase of the exchange rate factor by 12%, of which Western Europe increased 1.9%, the European emerging market increased 11%, North America increased 14%, and the Greater China region increased by 8%, P. The quarterly net loss narrowed sharply to 10 million euros from 272 million euros in the same period of fiscal 2012, excluding the goodwill impairment loss. The quarterly net profit was 42 million euros, much higher than the 37 million 100 thousand euros expected by analysts. < /p >
P sales decreased by 2.6% to 14 billion 492 million euros over the 2012 fiscal year, including 6.8% in Western Europe, 2.7% in emerging markets in Europe, 1.4% and 8.4% in the Americas and other Asian markets, respectively, showing an increase of 5.95% and 6.35% in the Greater China and Latin America respectively. Net profit increased by 6% to 839 million euros compared with the same period last year, and the operating profit rate rose to 8.7% from 8% in the previous year. The Group expects the operating profit margin in fiscal year 2014 to be between 8.5-9.0%, far from the target of 11% operating profit in 2015. Analysts also believe that it is very difficult to achieve the goal. But the good news is that the Reebok Reebok brand, which has been struggling at the bottom of the market, is close to reaching a target of gross margin of 40% in 2015, and 39.7% in the 2013 fiscal year. < /p >
< p > AdidasAG (ADS.DE), Adidas announced yesterday that it will renew its contract with CEO HerbertHainer of the group until 2017. During this period, it will work out a successor plan with them to prepare for the renewal of the group management. The 59 year old HerbertHainer has been the chief executive of AdidasAG (ADS.DE) Adidas since 2001. < /p >