Adidas reports Q3 virus rebound

FRANKFURT AM MAIN (AFP) – German sports manufacturer Adidas said yesterday that sales and profitability recovered in the third quarter as shops re-opened, alongside booming e-commerce sales, with a modest profit expected in the final quarter.

Adidas reported net profit of EUR546 million (USD646 million) for the three months to September, down 15.5 per cent from EUR646 million in the same period of the previous year.

But this followed a damaging second quarter for the company, when it posted a EUR295 million euro loss on sales of EUR3.6 billion.

Third-quarter revenues fell 7.0 per cent year-on-year to EUR6.0 billion, but beat expectations according to a survey by financial services provider FactSet, with e-commerce sales up 51 per cent.

“We saw a strong recovery in our business in the third quarter,” Chief Executive Kasper Rorsted said in a statement, but “a worsening of the pandemic in many regions of the world is again requiring our patience and support”.

Adidas reported a net profit of EUR546 million (USD646 million) for the three months to September. PHOTO: AFP

The Bavaria-based company predicts its top line to “develop similarly in the fourth quarter as it did in the third”, with operating profit to be between EUR100 – EUR200 million.

The outlook, however, “assumes no addition major lockdowns”, and a store opening rate above 90 per cent. Adidas said 93 per cent of stores were open, down from 96 percent at the end of September.

Major European markets including France and Britain have taken steps to shut stores to curb a second spike in coronavirus cases. At its most severe point in the spring, the pandemic closed 70 per cent of Adidas stores worldwide.

“We are now well-prepared to cope with these short-term uncertainties”, Rorsted said, with the company “better positioned to benefit from the long-term industry growth drivers accelerated by the pandemic such as health and wellbeing, athleisure and digitisation”. In the third quarter, traffic in stores continued to improve yet remained “significantly below prior year levels”, the company said.