The Adidas Group has raised its guidance for full-year sales and profits after a 17 percent sales hike to €4.8 billion in the first quarter, amounting to an increase of 22 percent in constant currencies. Supported by a higher gross margin and operating margin leverage, the group's operating profit for the three months was up by 35 percent to €490 million.
The German company, which has greatly regained impetus since last year on the back of favorable fashion trends and sharper marketing investments, saw its income from continuing operations jump by 38 percent to €350 million for the quarter. Its earnings per share from continued and discontinued operations even surged by 50 percent to €1.75 – compared with €1.17 for the same period last year, excluding goodwill impairment losses.
While the group's guidance previously called for sales to advance at a rate of 10 to 12 percent in constant currencies for the full year, it now projects a rise of around 15 percent on the same basis. And while net income from continuing operations was previously projected to improve at the same rate as sales, the latest Adidas guidance is that it will move up by between 15 and 18 percent for the year. The upgraded guidance for profit stems from the expectations of higher sales as well as continued operating leverage.
The Adidas group already raised its guidance in February, based on preliminary figures for 2015 indicating that it surpassed its sales and earnings targets for the year. It went on to report a sales increase of 16.4 percent to €16,915 million for 2015, up by 10 percent in constant currencies. The group's income from continuing operations reached €720 million excluding impairment charges, up by 12.2 percent.
The company is to release its quarterly figures next week, on May 4. It could then also announce the outcome of its strategic review for Taylormade Adidas Golf, which was meant to be finalized by the end of the first quarter.
