Did you hear?… adidas-Salomon announces net sales increase for the first quarter

Based on positive growth in all product segments, with most significant gains in apparel, adidas-Salomon has announced a net sales increase for the first quarter ending March 31 of 5 percent, to reach Euro 1,638 million (USD $ 1.48 billion), compared to Euro 1,558 million (USD $ 1.4 billion) in the first quarter last year. On a currency-neutral basis, sales grew 4 percent. Gross margin in the first quarter improved to 41.8 percent despite higher sourcing costs associated with the weak euro. Higher spending related to three previously announced strategic initiatives (the 2002 FIFA World Cup, the expansion of adidas own-retail activities and the buyout of adidas Italy) led to a 7 percent decline in first quarter net income to Euro 43 million (USD $ 38.8 million), or Euro 0.95 per share (USD $ 0.86), compared to Euro 46 million (USD $ 41.6 million) or Euro 1.02 per share (USD $ 0.92) in first quarter 2001. Backlogs at brand adidas too were up 7 percent vs. the prior year, with improvements coming from all regions. In North America, backlogs grew 10 percent (9 percent currency-neutral) supported by 18 percent growth in footwear and a 1 percent decline in apparel. As a result of adidas backlogs, retailer feedback for Salomon and TaylorMade-adidas Golf as well as the ongoing macroeconomic environment, adidas-Salomon is maintaining its 2002 sales growth target of at least 5 percent. “New products, major sporting events and a North America turnaround means that 2002 will be an exciting year,” said Herbert Hainer, chairman and CEO of adidas-Salomon. “Our performance in the first quarter is an important step towards our full year earnings target. We remain confident that we can deliver 5 to 10 percent earnings growth for the year.”