adidas pointing to UEFA Euro '12 as potential driver of growth in coming year
adidas announced today that net profit in Q4 ‘11 rose to $23.6M from $9.2M in the same period of the previous year due to lower expenses, according to Harriet Torry of the WALL STREET JOURNAL. Sales rose 11% on the year to $4.3B, "boosted by growth in North America and Greater China." The athletic apparel brand "maintained its guidance and warned higher raw material and labor costs will continue, particularly in the first half of the year." It pointed to the ‘12 London Games and '12 UEFA European Championship as "potential drivers of sales growth over the coming year." However, the company "disappointed analysts by maintaining its expectation" for ‘12 sales growth at a "mid- to high-single-digit rate on a currency-neutral basis," and earnings per share growth to between $4.62 and $4.83 from $4.19 in ‘11. Profit in Q4 was "boosted by lower marketing costs, lower expenses and increased insurance compensation, although the company declined to specify" from where the insurance proceeds stemmed. Higher input costs "pushed the company's gross margin down" to 45.6% from 46.5% a year earlier though adidas said that it expects the margin to remain at the ‘11 level of around 47.5% (WSJ.com, 3/7).