Helen Reed
HERZOGENAURACH, GERMANY (Reuters) – German sportswear giant Adidas (OTC:) said on Wednesday it expects sales to decline in North America this year, blaming a still-crowded market as the company continues to sell out of sneakers from its warehouse. destroyed the Yeezy line.
Exchange-neutral sales in North America are expected to decline at a mid-single-digit rate in 2024, with growth forecast in all other regions, Adidas said as it announced final full-year results.
Adidas reported preliminary full-year results in late January and provided 2024 guidance that fell well below analysts’ expectations as profits were squeezed by the sell-off of its discontinued Kanye West sneaker line.
“Although nowhere near good enough, 2023 ended better than I expected at the start of the year,” said chief executive Bjorn Gulden.
The German retailer said its board would propose a dividend of 0.70 euros ($0.7650) per share, unchanged from last year, despite a difficult 2023 during which the company reported a net loss from continuing activities amounting to 58 million euros.
Adidas is betting it can regain market share Nike (NYSE:) and others, although demand for sportswear is falling. The company has capitalized on the trend for low-top suede terrace sneakers such as the Samba and Gazelle and increased production last year.
Footwear sales rose 8% from the fourth quarter, while apparel sales fell 13%.
“Things have clearly gone in the right direction at Adidas since Bjorn Gulden took over,” said Thomas Joeckel, portfolio manager at Union Investment. “Brand intensity is increasing, which is also reflected in the fact that fewer products now have to be discounted.”
($1 = 0.9151 euro)