BERLIN — Although fourth-quarter earnings slipped 13 percent and nominal sales dropped almost 10 percent, Adidas-Salomon cited a better product mix as well as a stronger euro for 2003 results that set record earnings and a robust gross-margin rate.
In preliminary results released Thursday, net income for the year-end period climbed 14 percent to $325 million, or 260 million euros, which was at the upper end of the company’s targeted earnings range. For the fourth quarter, however, earnings dropped to $32.5 million, or 26 million euros, from $37.5 million, or 30 million euros, in the same period last year. All dollar figures are calculated from the euro at current exchange rates.
The company’s gross-margin rate increased 1.6 percentage points to 44.9 percent in 2003, the highest level ever achieved by the company. The German active sportswear giant attributed the strong performance to “increased Adidas own-retail activities, an improving product mix as well as a stronger euro.”
Fourth-quarter sales hit $1.7 billion, or 1.36 billion euros, compared with $1.89 billion, or 1.51 billion euros, for the same period in 2002. In euros, 2003 sales showed a decline of 4 percent, dropping to $7.84 billion, or 6.27 billion euros. However, from a “currency neutral” point of view, sales grew 5 percent, the company said, adding that currency neutral sales grew for all brands and regions with the exception of North America.
Final full year results will be released on March 10.