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'2008 is another record year for the company' - adidas CEO, Chairman
04 Mar '09
5 min read
At TaylorMade-adidas Golf, currency-neutral revenues increased 7%, due to positive sales momentum in apparel, footwear, balls and putters. Currency translation effects negatively impacted sales in all segments in euro terms. adidas sales increased 10% to € 7.821 billion in 2008 from € 7.113 billion in 2007. Sales at Reebok decreased 8% to € 2.148 billion versus € 2.333 billion in the prior year. TaylorMade-adidas Golf sales increased 1% to € 812 million in 2008 from € 804 million in 2007.
Gross margin reaches record level of 48.7%
The gross margin of the adidas Group increased 1.3 percentage points to 48.7% in 2008 (2007: 47.4%). This is the highest annual gross margin for the Group since the IPO in 1995. The improvement was mainly due to an improving regional mix, further own-retail expansion and a more favourable product mix. As a result, gross profit for the adidas Group rose 8% in 2008 to reach € 5.256 billion versus € 4.882 billion in the prior year.
Operating margin improves 0.7 percentage points
The operating margin of the adidas Group increased 0.7 percentage points to 9.9% in 2008 (2007: 9.2%). The operating margin increase was a result of the gross margin improvement and higher other operating income, which more than offset higher other operating expenses as a percentage of sales.
Other operating expenses as a percentage of sales increased 0.6 percentage points to 40.5% in 2008 from 40.0% in 2007. Higher expenses to support the Group's growth in emerging markets were partly offset by efficiency improvements and a slight decrease in marketing working budget expenditure as a percentage of sales. Group operating profit increased 13% in 2008 to reach € 1.070 billion versus € 949 million in 2007.
Income before taxes increases 11%
Income before taxes grew 11% to € 904 million in 2008 from € 815 million in 2007. This was a result of the Group's operating margin increase, which more than offset higher net financial expenses. Net financial expenses increased 23% to € 166 million in 2008 from € 134 million in the prior year primarily due to foreign currency exchange losses resulting from the revaluation of balance sheet positions in foreign currencies.
Net income attributable to shareholders grows 16%
The Group's net income attributable to shareholders increased 16% to € 642 million in 2008 from € 551 million in 2007, representing the eighth consecutive year of double-digit earnings growth. The Group's higher operating profit, a lower tax rate and lower minority interests contributed to this development. The Group's tax rate decreased 3.0 percentage points to 28.8% in 2008 (2007: 31.8%) mainly due to a more favourable regional earnings mix throughout the Group as well as one-time tax benefits in the fourth quarter of 2008.
Gross margin reaches record level of 48.7%
The gross margin of the adidas Group increased 1.3 percentage points to 48.7% in 2008 (2007: 47.4%). This is the highest annual gross margin for the Group since the IPO in 1995. The improvement was mainly due to an improving regional mix, further own-retail expansion and a more favourable product mix. As a result, gross profit for the adidas Group rose 8% in 2008 to reach € 5.256 billion versus € 4.882 billion in the prior year.
Operating margin improves 0.7 percentage points
The operating margin of the adidas Group increased 0.7 percentage points to 9.9% in 2008 (2007: 9.2%). The operating margin increase was a result of the gross margin improvement and higher other operating income, which more than offset higher other operating expenses as a percentage of sales.
Other operating expenses as a percentage of sales increased 0.6 percentage points to 40.5% in 2008 from 40.0% in 2007. Higher expenses to support the Group's growth in emerging markets were partly offset by efficiency improvements and a slight decrease in marketing working budget expenditure as a percentage of sales. Group operating profit increased 13% in 2008 to reach € 1.070 billion versus € 949 million in 2007.
Income before taxes increases 11%
Income before taxes grew 11% to € 904 million in 2008 from € 815 million in 2007. This was a result of the Group's operating margin increase, which more than offset higher net financial expenses. Net financial expenses increased 23% to € 166 million in 2008 from € 134 million in the prior year primarily due to foreign currency exchange losses resulting from the revaluation of balance sheet positions in foreign currencies.
Net income attributable to shareholders grows 16%
The Group's net income attributable to shareholders increased 16% to € 642 million in 2008 from € 551 million in 2007, representing the eighth consecutive year of double-digit earnings growth. The Group's higher operating profit, a lower tax rate and lower minority interests contributed to this development. The Group's tax rate decreased 3.0 percentage points to 28.8% in 2008 (2007: 31.8%) mainly due to a more favourable regional earnings mix throughout the Group as well as one-time tax benefits in the fourth quarter of 2008.
adidas AG
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