By Ellen Emmerentze Jervell
FRANKFURT-- Adidas AG reported a slight rise in second-quarter
earnings Thursday, supported by strong sales in China and Western
Europe, and said it could shed its golf unit.
The world's second-largest sportswear maker, after Nike Inc.,
said net profit rose 1.4% to EUR146 million ($159 million),
compared with EUR144 million a year earlier.
The company's main growth drivers were the positive performances
of its Adidas and Reebok brands and strong consumer sentiment in
China and Western Europe.
Compared with the same period last year, when Adidas benefited
from revenue related to the FIFA World Cup, sales rose 5% to EUR3.9
billion when adjusted for currency fluctuations.
Adidas's chief executive, Herbert Hainer, was under investor
pressure last year after issuing a string of profit warnings and
scrapping the company's financial targets for 2014 and 2015. In
March this year, Adidas launched a new strategic plan and reported
strong first-quarter results, and the embattled boss declared a
financial resurgence was under way.
"We have said all along that our new strategy 'Creating the New'
will already show first positive results this year. The second
quarter is proof positive for that," Mr. Hainer said Thursday.
A blow for management in the second quarter, however, was the
continued negative performance of its TaylorMade-Adidas Golf unit.
Mr. Hainer has been pushing for a recovery in the business, but
sluggish demand for golf equipment remained a challenge for the
German sporting goods maker. TaylorMade-Adidas Golf's
currency-adjusted sales were down 25.5% in the period. Adidas said
it had engaged with an investment bank to analyze "future options"
for the business.
Adidas's currency-adjusted sales in North America were down 0.5%
in the second quarter. The company reported sales growth in the
region in the first quarter of the year, but at the time, higher
marketing costs offset that gain. Mr. Hainer has said he expects
Adidas to be profitable in North America by the end of the
year.
Adidas's organic sales in Greater China and Western Europe were
up 19.3% and 12%, respectively.
Adidas confirmed its guidance for 2015. The company expects
sales to increase at a mid-single-digit rate on a currency neutral
basis.
Write to Ellen Emmerentze Jervell at ellen.jervell@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires