adidas-Salomon currency-neutral sales up 7% for the first nine months
Currency-neutral sales for the Group in the third quarter grew 6%. On a reported basis, however, at � 1.9 billion, third quarter sales were slightly lower than the level achieved in 2002. During the first nine months, sales increased 7% on a currency-neutral basis. This represents a decline of 2% in reported terms from � 5.0 billion in 2002 to � 4.9 billion in 2003.
Herbert Hainer, Chairman and CEO of adidas-Salomon, stated: #'We've faced a number of economic, political and market challenges in the first nine months of 2003, and overall have delivered excellent sales and earnings performances. Regionally, Europe and Asia have done particularly well and we are quickly moving to refocus our efforts in North America. adidas-Salomon is an organization with flexibility, imagination and tenacity – exactly the types of skills that it takes to win in our industry today.''
TaylorMade-adidas Golf the fastest growing segment in the first nine months
Revenues at TaylorMade-adidas Golf in the first nine months increased 9% on a currency-neutral basis. This represents a decline of 6% in reported terms, from � 516 million in 2002 to � 487 million in 2003. Excluding the � 21 million sales for Slazenger Golf in the first nine months of 2002 from a licensing arrangement that was not renewed in 2003, sales for TaylorMade-adidas Golf increased 14% in currency-neutral terms (-2% in euro terms), making TaylorMade-adidas Golf the Groups fastest growing segment. The underlying sales increase is attributable to growth in RAC irons as well as in adidas Golf footwear and apparel. At brand adidas, sales increased 8% on a currency-neutral basis in the first nine months. In reported terms, this represents a decline of 1% from � 4.1 billion in 2002 to � 4.0 billion in 2003. Drivers of this development were solid underlying growth in the Sport Performance running and training categories as well as in the Sport Heritage division. Salomon sales in the first nine months were down 2% on a currency-neutral basis. This represents a decline of 8% in reported terms from � 424 million to � 390 million. Solid growth in cycling components and soft goods was offset by lower sales in the alpine, snowboard and inline skate categories due to difficult retail conditions.
Currency-neutral sales in Europe grow 8%
Sales for adidas-Salomon in Europe increased 8% on a currency-neutral basis in the first nine months of 2003. In reported terms, this represents an increase of 5% from � 2.5 billion in 2002 to � 2.7 billion in 2003. The main drivers of this underlying increase were particularly strong developments in Italy, France and the UK as well as in the emerging markets. Group sales in Asia increased 10% on a currency-neutral basis in the first nine months of 2003. In reported terms, this represents a decrease of 3% to � 817 million (2002: � 841 million). Underlying growth was driven by vigorous increases in China, Japan and South Korea. In North America, sales for the Group in the first nine months of 2003 were stable in currency-neutral terms compared to the prior years level. In reported terms, sales declined 16% to � 1.2 billion versus � 1.5 billion in the prior year. This reflects a weakness in demand for certain adidas product lines and the difficult market conditions there. In Latin America, sales were up 37% in the first nine months of 2003 on a currency-neutral basis, making it the fastest growing region within the Group. This represents an increase of 8% in reported terms to � 130 million compared to � 120 million in 2002. Higher sales in Argentina and Brazil were the main drivers of this improvement.
adidas order backlog reflects mixed regional development
Order backlog for brand adidas declined 2% on a currency-neutral basis (-8% in euro) at the end of the third quarter of 2003. This development reflects tough comparisons with the prior year and continued weakness in North America. Footwear backlogs declined 10% in currency-neutral terms ( 16% in euro) driven by significantly lower orders in North America. Apparel orders increased 6% in currency-neutral terms, highlighting the brands activities to grow sales in this product category. In reported terms, orders were stable compared to the prior years levels. In Europe, orders increased 7% on a currency-neutral basis (+4% in euro) supported by strong growth in apparel, where backlogs were up 13% (+9% in euro). Footwear backlogs were up 1% currency-neutral (-2% in euro). In Asia, currency-neutral backlogs grew 11% (+2% in euro), with strong improvements coming from Japan and China. Footwear backlogs declined 1% currency-neutral (-8% in euro). On a currency-neutral basis, apparel orders increased 22% (+13% in euro). In North America, order backlogs were down 23% on a currency-neutral basis, which is in line with the guidance adidas-Salomon provided for the market at the Investor Day on September 30. This represents a decline of 35% in reported terms. Currency-neutral footwear backlogs declined 29% (-40% in euro). Currency-neutral apparel orders decreased 16% (-28% in euro).