Adidas Profit Misses Estimates, Shares Have Fallen 17% This Year

HERZOGENAURACH, Germany — Adidas AG reported first-quarter profit that missed analysts' estimates as the world's second- biggest sporting-goods maker suffers from the relative strength of the euro and a drop in revenue at its golf unit.

Net income declined to 204 million euros ($283 million), Herzogenaurach, Germany-based Adidas said today in an e-mailed statement, compared with the average 218.8 million-euro estimate of analysts surveyed by Bloomberg. Sales fell 6 percent to 3.53 billion euros, compared with the average 3.61 billion-euro estimate.

Revenue at the company’s TaylorMade golf business fell by a double-digit percentage. Chief Executive Officer Herbert Hainer targets 17 billion euros in sales and an operating profit margin of 11 percent next year, goals analysts said Adidas looks increasingly unlikely to meet. The relative strength of the euro is diminishing reported sales from overseas and American rival Nike Inc. is making inroads in western Europe.

“We consider the company’s targets for 2015 to be very ambitious,” Michael Gorny, an analyst at Bankhaus Lampe, said in an April 25 research note, adding that he doesn’t expect the company to meet the targets before 2016. Analysts surveyed by Bloomberg expect Adidas’ sales to reach 15.9 billion euros in 2015.

Hainer said the company expects an accelerated period of growth and momentum for the rest of the year and the company confirmed its full-year forecast for sales to advance at a high- single-digit pace on a currency neutral basis this year.

Shares of Adidas have fallen 17 percent this year through yesterday, compared with a drop of less than 1 percent in the DAX index.

By Aaron Ricadela; Editors: Celeste Perri, Kim McLaughlin