Adidas’s revenue and operating profit both declined in the first quarter of this year.
Local timeMayMay June, German sports brand Adidas ( Adidas (Adidas) announced its first quarter results for 2022. Affected by supply chain restrictions and epidemic-related lockdown measures, Adidas’s revenue and operating profits declined in the first quarter of this year, and it also lowered its 2022 fiscal year performance expectations.
The financial report shows that in the first quarter of this year, Adidas’ revenue reached 5.302 billion, which was down from the same period last year without taking into account exchange rate factors. 3%. Due to a significant increase in supply chain costs, gross profit margin decreased 1.9 percentage points to 49.9%.
Adidas pointed out in its financial report that the company faces challenges in both supply and demand. Affected by the blockade caused by the Vietnam epidemic last year, the company’s supply chain was restricted, and revenue in the first quarter of this year decreased by approximately 400 million euros.
From a regional perspective, Adidas’ demand in the Western market remained strong in the first quarter of this year, while the Eastern market continued to be under pressure. During the reporting period, excluding exchange rate factors, the company’s total sales in all Western markets increased by 13%. Adidas’ revenue in Greater China fell by 35% as Greater China and the Asia-Pacific region were affected by the lockdown measures brought about by the epidemic. Revenue in the Asia-Pacific region fell16%.
Adidas2022 In terms of revenue and profit by region in the first quarter of 2022, Adidas’ operating profit in the first quarter of this year was 4.37 100 million euros, a year-on-year decrease of 37.93%, compared with 7.04 billion euros in the same period last year; operating profit margin It was 8.2%, a year-on-year decrease of 5.2 percentage points. Net income from continuing operations dropped from 5.02euro to 3.1euro. The basic level of continuing operations Earnings per share amounted to €1.60, compared with €2.60 in the same period last year. Adidas CEO Kasper Rorsted said that the Asia-Pacific market will resume growth in the second quarter of this year, and the challenging market environment in Greater China is expected to continue.
The financial report shows that a large number of Adidas stores in China have been closed and customer traffic has also dropped significantly. It is expected that 2022 revenue in Greater China will decline significantly. At the same time, demand in Europe, the Middle East and Africa, North America and Latin America and the Asia-Pacific region, which together account for more than 80% of the company’s business, is extremely strong. The company expects that the strong underlying growth momentum in Western markets and the expected return to double-digit growth in the Asia-Pacific region will offset the revenue decline in Greater China.
Adidas also updated its 2022 fiscal year outlook, lowering this year’s revenue growth without currency exchange factors to 11% or so, previously 11% to 13%; net income from continuing operations is also expected to be lowered to about 1.8euro, compared with 1.8euro to 19 span> billion euros.
As revenue in Greater China is lower than expected, resulting in an unfavorable market mix for the company, Adidas expects that gross profit margin and operating profit margin will not increase in 2022. The company’s gross profit margin in 2018 was around 50.7%, and its operating profit margin was about 9.4%. The previous goal was to increase the annual gross profit margin to 51.5%-52.0% in 2022 and the operating profit margin to 10.5%-11%.
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