Adidas Group reports full year and fourth quarter 2012 results.
Q4 2012 highlights:
•Currency-neutral Group sales up 1%
•Taylor Made-adidas Golf sales increase 15%
•Greater China and European Emerging Markets grow 12% and 9%, respectively
Full year 2012 highlights:
•Currency-neutral Group sales up 6% to a new record level of € 14.9 billion
•adidas and TaylorMade-adidas Golf sales increase 10% and 20%, respectively
•Gross margin improves 0.2pp to 47.7% despite significant pressure from input costs
•Goodwill impairment in an amount of € 265 million
•Operating margin excluding goodwill impairment improves to 8.0%
•Earnings per share excluding goodwill impairment increase 29% to a record level of € 3.78
•Net cash position of € 448 million at year-end
•Group inventories down 1% at year-end
•Management to propose a 35% higher dividend of € 1.35 per share
•Group sales to increase at a mid-single-digit rate
•Operating margin to improve to a level approaching 9.0%
•Earnings per share to be in the range of € 4.25 to € 4.40
"2012 has been another successful year for the adidas Group," commented Herbert Hainer, adidas Group CEO. "Our products and brands were again at the fore, not only being the most visible at the year's major sports events, but also enjoying several important market share victories along the way. The resulting margin improvements and significant cash flow generation underpin the trajectory and value we are unlocking with our Route 2015 strategic plan."
Commercial irregularities discovered at Reebok India Company
As announced in an ad hoc release on April 30, 2012, commercial irregularities were discovered at Reebok India Company. The discovery of these irregularities resulted in the identification of material errors in the prior period financial statements of Reebok India Company. As a consequence of these errors, material misstatements are also included in the consolidated financial statements of adidas AG for the 2011 financial year and for previous financial years, which have to be corrected in accordance with IAS 8.
These corrections are reflected in the consolidated financial statements as at December 31, 2012, in which the comparative figures for the year 2011 are restated and the opening balance sheet for 2011 is corrected to the extent that earlier periods are affected. The results of these restatements led to a reduction of net income attributable to shareholders of € 58 million for 2011. In addition, shareholders' equity of the opening balance sheet for 2011 is negatively impacted by € 153 million.