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Frankfurt - German sports equipment group Adidas posted on Wednesday a 93% drop in second-quarter profit which swamped losses elsewhere in the country's retail sector, but confirmed its full-year outlook.
Adidas said net profit in the three months from April to June dropped to €9m ($13m) from €116m in the same period one year earlier.
But the result was better than a forecast loss of €2.2m by analysts polled by Dow Jones Newswires.
Sales in the quarter fell by 2.5% to €2.46bn, mainly owing to weak results in Europe, and Adidas maintained its forecast for a drop in full year sales of between one to 5%.
"I believe we have seen the bottom in our financial performance this year," a statement quoted chief executive Herbert Hainer as saying.
He added that the figures were exactly in line with a forecast given in May, "if not a little better."
"Although there are still challenges ahead, I am confident that our results will improve as we go through the remainder of the year," Hainer stressed.
The results underscored a consumption slump associated with the global recession.
On Monday, German retailer Metro, number three worldwide, reported a 3.8% fall in second quarter sales, but eked out a net profit of €48m.
Metro said its full year result would depend in large part on developments in worsening jobs markets.
German retail sales in general posted a surprise drop of 1.8% in June according to an estimate based on seven German states that represent around 76% of total sales, the Destatis statistics office said on Monday.
For the first half of 2009, Adidas said net profit fell 95% to €13m, on sales that lost 2% to €5.034bn.
One of the world's leading makers of sporting goods equipment and clothing, Adidas has taken a beating as consumer spending worldwide decreased owing to rising unemployment and dampened consumer sentiment.
It has also been hit by higher input costs, effects from the devaluation of the Russian rouble and promotional costs linked to the 2010 football world cup, the statement said.
On the other hand, Adidas has accelerated its restructuring programme that is aimed at achieving €100m in annual savings.
A breakdown of the figures showed that first half sales of both the Adidas and Reebok brands fell by 3% and 2% respectively, but that the TaylorMade-Adidas Golf division turned in an 8% increase.
On a geographical basis, "growth in North America and in Latin America was offset by declines in most major European and Asian markets," the group said.
-AFP
