Financial Report Financial reports from the largest companies of the world

Adidas profit decreased with 64% because of expensive marketing

The sports giant Adidas reported a decline in profits from 64 percent in the fourth quarter of 2009. Thus the positive result for the period amounted to 19 million EUR, well below analysts' expectations for profit of 25 million. In the last quarter of 2009 Adidas sales decreased by 5 percent annually to 2.46 billion EUR, also below expectations. They were for sales of 2.51 billion EUR, transmit Market Watch. The report of giants shows that the deterioration of the results is due to increased marketing costs for the forthcoming World Cup. Significant marketing costs incurred for implementation of the strategy to promote the Reebok brand in North America. Reebok has brought the cost for removal of assets, the report shows. Estimates of Adidas in 2010 are to achieve a profit of 1,90-2,15 EUR per share, and to pay dividends amounting to 20-40 per cent of net profit. The company invested in advertising and rose its market stake, but even this was not enough for the positive financial report.
In comparison, in year 2009 earnings per share was 1.22 EUR, a dividend - 35 cents.