Adidas Upgrades Full-Year Guidance Despite Revenue, Operating Profit Fall
October 17 2023 - 1:31PM
Dow Jones News
By Andrea Figueras
Adidas upgraded its full-year guidance on the back of Yeezy
inventory reductions and a better-than-expected underlying
business, despite a decline in revenue and operating profit in the
third quarter.
The German athletic apparel and footwear company said on Tuesday
that, according to preliminary results, it now expects
currency-neutral revenues to decline at a low-single-digit rate,
while it previously forecast a decline in a mid-single-digit
rate.
The underlying operating profit--excluding any one-offs related
to Yeezy and the underway strategic review--is now estimated around
100 million euros ($105.6 million), up from a prior guidance around
break-even level, the company said.
Adidas also said that it now expects to report an operating loss
of around EUR100 million this year instead of loss of EUR450
million as it had previously forecast, including the potential
write-off of the remaining Yeezy inventory of now around EUR300
million, down from EUR400 million previously.
The company posted a 6% decline in revenue to EUR6 billion,
compared with EUR6.41 billion in the year earlier period.
Currency-neutral revenues increased 1% compared with the prior year
level, it said.
Operating profit fell to EUR409 million during the quarter from
EUR564 million in the year-earlier period, while the operating
margin was 6.8%, down from 8.8% in 2022. Gross margin improved 0.2%
to 49.3%.
Write to Andrea Figueras at andrea.figueras@wsj.com
(END) Dow Jones Newswires
October 17, 2023 13:16 ET (17:16 GMT)
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