Adidas'S Two Quarter Slowdown Is Dragged Down By Golf Business

The sluggish global golf market has continued to shrink the TaylorMade golf business of the world's second largest sporting goods manufacturer, AdidasAG (ADSGn.DE) Adidas group, which has also been dragged down in the two quarter. The group has said that it will restructure the business and does not exclude the sale of individual brands.

AdidasAG

The group's net operating profit in the two quarter was 146 million euros, slightly below the market forecast of 1.47-1.48 billion euros, a slight increase of 1.7% over the same period last year, 144 million euros.

Adidas's growth slowed in the two quarter, dragged down by golf business.

Fixed exchange rate, TaylorMade golf business after a quarter of warmer (down 8.6%) again recorded a 25.5% decline, resulting in the group's two quarter revenue growth slowed sharply from 5% in the first quarter to 5%, the same period last year, the world cup effect also has a high base.

According to the actual exchange rate, the two quarter revenue increased by 14.9% to 3 billion 907 million euros, exceeding the market expectations of 3 billion 800 million euros.

AdidasAG Adidas group said in its earnings report that it has launched a restructuring of TaylorMade golf business to revive the business in order to raise prices, strengthen sales promotion and trading mode plans, optimize supply chain and product costs. The group has also invited investment banks to deal with two golf brands, Adams and Ashworth. A group spokesman later said that TaylorMade brand could also be sold.

AdidasAG Adidas Group acquired the TaylorMade golf brand in 1997 through the acquisition of SalomonSA, a French skiing manufacturer. In 2008 and 2012, it was $72 million 800 thousand.

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70 million US dollars to acquire Ashworth and Adams.

But golf has been on the decline for the longest time in the largest market in the United States, and golf business has made the AdidasAG Adidas group profitable for many times. The group now expects its annual revenue to be less than 913 million euros in fiscal year 2014 and 6.2% in fiscal 2014.

On the other hand, Adidas Adidas brand and Reebok Reebok brand achieved 8.2% and 6.4% growth in the two quarter, respectively. AdidasOriginals, AdidasNEO and Reebok Reebok's training category increased to double digits, and Adidas training category also had a median digit growth rate.

By region, Greater China market

With a 19.3% growth rate and a 564 million euro income, it has become the third largest market of the group.

Western Europe and the Middle East, Africa and Australia (MEAA) grew by 12% and 15.6% respectively.

Russian Federation plunged 14.2%, Japan and North America also saw 6.1% and 0.5% decline, of which Reebok Reebok was very weak in North America, and Adidas Adidas performed worse in Japan over the same period last year, the two.

No progress has been made in Russian Federation.

The gross profit margin in the two quarter dropped 90 basis points to 48.3%. The better price and product mix were offset by the increase in input costs, the negative impact of exchange rate fluctuations and the lower gross margin of TaylorMade golf business.

The operating margin also dropped by 40 basis points to 6%.

The group maintains annual median revenue growth at a fixed rate, a median growth rate, a net profit growth of 7%-10% for continuing operations and a profit margin of 6.5%-7.0%.

AdidasAG (ADSGn.DE) increased by 2.59% to 76.41 euros early on Thursday, to 75.26 euros in the absence of times, and the increase narrowed to 1.05%.

The stock has risen 30.6% so far in 2015.