Adidas tops analysts’ estimates for profit and sales in the fiscal third quarter
- Adidas tops analysts’ estimates for profit and sales in the fiscal third quarter.
- The German multinational secures a new £1.13 billion loan facility.
- Adidas forecasts an up to 5% annualised decline in revenue in the fourth quarter.
Adidas (ETR: ADS) published it is financial results for the fiscal third quarter on Tuesday that topped analysts’ estimates for profit and sales. On a year to date basis, however, it saw a decline on both fronts.
Adidas was reported about 3% down in premarket trading on Tuesday and tanked another 3% in the next hour. Shares of the company are now 3% down year to date in the stock market, after recovering 70% since its low in March. Interested in investing in the stock market online? Here’s a simple guide to get you started.
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Adidas’ Q3 financial results versus analysts’ estimates
Adidas said that its net profit in the third quarter came in at £486.92 million versus a higher £576.10 million in the same quarter last year. For operating profit, the German company posted £708.9 million in Q3 versus the year-ago figure of £799.94 million.
In terms of sales in the recent quarter, the sports goods company recorded £5.32 billion. In comparison, its sales had come in at a higher £5.72 billion last year. Adidas recently named Amanda Rajkumar as the head of human resources.
According to FactSet, experts had forecast Adidas to report £5.30 billion of sales in the third quarter. Their estimate for net profit and operating profit stood at £470.42 million and £646.55 million, respectively.
Adidas said that its store opening rate climbed to 96% at the end of September. It, however, slid back to 93% recently. In the prior quarter (Q2), Adidas had noted £296.97 million of operating loss, as per the report published in the first week of August.
For the fiscal fourth quarter, the Herzogenaurach-based company forecasts an up to 5% annualised decline in its revenue on a currency-neutral basis. Adidas expects its operating profit to fall in the range of £89 million to £178 million in Q4.
Adidas secures a new £1.13 billion loan facility
Adidas also secured a new £1.13 billion loan facility on Tuesday to cushion the economic blow from the ongoing COVID-19 crisis. CFO Harm Ohlmeyer said:
“Obtaining strong investment-grade credit ratings, issuing €1.5 billion worth of bonds at favourable conditions and securing a new €1.5 billion syndicated loan from our partner banks has considerably strengthened Adidas’s financial profile.”
At the time of writing, Adidas is valued at £50.89 billion and has a price to earnings ratio of 101.70.