Adidas attributed quarterly sales bump to World Cup

Adidas joined Italy as a World Cup winner, though the retail company's victory came in sponsorship, as the retailer reported a 20 percent bump for the second quarter to EUR 1.8 billion.

The German sportswear group reported a rise in first-half sales of 17 percent, going to EUR 3.3 billion. Sales at Reebok, which it acquired at the beginning of the year in a EUR 3.1 billion deal, were down by 9 percent to EUR 1.05 billion.

"The Adidas Group had an outstanding first half of 2006 crowned by our strong showing at the World Cup," said Herbert Hainer, chairman and chief executive of adidas.

One drawback for adidas was that net profits for the second quarter dropped 11 percent to EUR 83 million, and operating margin declined by 2.6 percentage points to 8.6 percent for the first half of the year.

The firm felt the merger with Reebok was a cause, but also believed higher World Cup marketing expenditure played a role. Addidas was an official sponsor and ball supplier of the World Cup, as well as having deals with six teams in the tournament, including runners-up France.

Nike sponsored eight teams, while Puma was behind Italy.

Adidas backed its sponsorship with the Adidas "+10" advertising campaign featuring, among others, France's Zinedine Zidane and England's David Beckham. Nike ran an ad campaign featuring "La Joga Bonita" with France-ex-international Eric Cantona and Brazil's Ronaldinho.

Source: euFootball.BIZ © Copyright 2006 - All rights reserved.