PARIS — Adidas stock slid 15.4 percent in trading Thursday after the company lowered its full-year guidance.
Shares closed at 59.41 euros, or $79.67 at current exchange.
The company said Thursday morning currency fluctuations and high marketing costs linked to the FIFA World Cup dented its second-quarter sales.
Citing factors such as tensions in Russia and Ukraine, increasing marketing costs and the poor performance of the golf segment, Adidas said it now expects a mid- to high-single-digit increase in currency-neutral sales in 2014, after earlier predicting a high-single-digit rise.
In addition, it lowered its forecast for net profits to around 650 million euros, or $887 million, from a range of 830 million euros to 930 million euros, or $1.13 billion to $1.27 billion, previously. Adidas management postponed the delivery of its so-called Route 2015 targets at a meeting of the executive board, it said.
Sales rose 2 percent in the second quarter to 3.46 billion euros, or $4.75 billion. Stripping out the effect of foreign exchange rate variations, revenues were up 10 percent. Net income attributable to shareholders totaled 144 million, or $197 million, during the period.
Herbert Hainer, chief executive officer of the Herzogenaurach, Germany-based sporting goods firm, said it plans to clean up markets, focus on growth opportunities and revise its internal organization in a bid to return to “a higher and more consistent level of earnings growth” in the mid to long term.
“Everything we announced today has one objective: to strengthen our brands, to drive consumer desire, and to set our group up for long-term success. As we gear up for our next five-year strategic plan, we will assert ourselves much more aggressively in the marketplace,” he said.
“While we have delivered notable achievements with our Route 2015 plan, we also accept that we have not executed to our high standards at all times or provided enough flexibility to react in adverse market conditions. This we now tackle head on. The strength of our winning performance at the 2014 FIFA World Cup shows exactly what we are capable of when we execute flawlessly,” Hainer added.
Adidas is scheduled to publish full financial results for the first half on Aug. 7.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast