For the second time in three months, Adidas is scaling back its forecast for this year. Due to the problems in China and the recent sluggish demand, the sporting goods and clothing manufacturer expects sales growth of only around 5 percent after a weak third quarter. Most recently, Adidas had expected 5 to 9 percent.
The Dax group is also cutting its profit forecast. The profit from continuing operations will only be 500 million euros this year, the number two on the world market announced on Thursday evening in Herzogenaurach. That would be a decrease of two-thirds compared to the previous year (1.49 billion). Until the middle of the year, Adidas had hoped for an increase in profits to 1.8 billion, then to 1.3 billion.
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The Adidas share collapsed in late trading on Thursday by 4.3 percent to 110.68 euros.
Now the outgoing CEO Kasper Rorsted (60) wants to counteract with a cost-cutting program. "The various initiatives, which will lead to one-off expenses of around 50 million euros in the fourth quarter of 2022, are expected to compensate for cost disadvantages of up to 500 million euros in 2023," explained Adidas. As a result, profits are expected to be 200 million euros higher. Savings must be made in all areas, said a spokesman. At Adidas, there is currently a hiring freeze.
The search for a successor for Rorsted is difficult. Because Rorsted leaves behind so many construction sites that the new CEO faces a hell of a job.
Expensive exit from Russia weighs on earnings
The weak euro weighs on the company, because the sports industry buys in dollars, as well as rising delivery costs. In addition, there is the expensive withdrawal from Russia and the settlement of a patent dispute with Nike over sports shoes. These and other special effects add up to half a billion euros by the end of the year. Around EUR 300 million of this was already booked in the third quarter, in which profit from continuing operations shrank accordingly to EUR 179 (2021: EUR 479) million. Adjusted for currency effects, sales increased by only 4 percent to 6.41 billion euros.