Adidas lifts full-year targets after strong third quarter

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Adidas, the German maker of sportswear and equipment, said Thursday it was raising its full-year earnings targets after a stronger-than-expected third quarter and first nine months.

"After the stronger than expected performance in the first nine months, management has increased the full-year 2011 sales and earnings guidance," Adidas said in a statement.

It was now pencilling in sales growth of close to 12 percent instead of 10 percent previously. And earnings per share were projected to rise by "a rate approaching 16 percent to a level around 3.15 euros", comoared with an earlier forecast of an increase of 15 percent.

"Our brands and products are resonating with consumers around the world

like never before," boasted chief executive Herbert Hainer.

"Our record third quarter results were driven by growth in all key geographies, brands and channels. We will finish 2011 clearly exceeding our initial expectations after already surpassing our 2008 record earnings mark after the first nine months. Therefore I can already confirm today: 2011 will be another record year for Adidas," he said.

In the period from July to September, net profit rose by 14.1 percent to 303 million euros on an 8.0-percent increase in sales to 3.744 billion euros.

Taking the first nine months, bottom-line profits were up 16.4 percent at 652 million euros and sales up 11.3 percent at 10.081 billion euros.

Looking further ahead, Adidas said it was projecting sales and earnings to rise again in 2012 "assuming no significant deterioration in the economic environment."

Based on the "strong momentum" of its brands, "as well as the opportunities provided by the EURO 2012 soccer championships and the London 2012 Olympic Games, sales are projected to increase at a mid- to high-single-digit rate," Adidas said.

Higher production and labour costs, as well as currency volatility would provide headwinds for profit. Nevertheless, earnings per share were expected to rise faster than sales, at a rate 10-15 percent, it said.

© 2011 AFP

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