Reebok 2009 Annual Report Download - page 141

GROUP MANAGEMENT REPORT – FINANCIAL REVIEW BUSINESS PERFORMANCE BY SEGMENT Other Businesses Performance 137
Other Businesses Performance
Other Businesses primarily include the TaylorMade-adidas Golf, Rockport and Reebok-CCM Hockey segments. In addition, the
segment Other centrally managed brands, which comprises brands such as Y-3, is also included. In 2009, currency-neutral sales
of Other Businesses decreased 4%. In euro terms, sales remained almost stable at € 1.283 billion (2008: € 1.285 billion). Gross
margin decreased 2.8 percentage points to 39.4% (2008: 42.2%). This was mainly a result of price repositioning initiatives at
TaylorMade-adidas Golf due to the negative golf market development. Gross profit decreased 7% to € 506 million in 2009 from
€ 543 million in 2008. As a result of the decline in gross margin and higher operating costs as a percentage of sales, segmental
operating margin decreased 4.3 percentage points to 21.9% (2008: 26.2%). In absolute terms, segmental operating profit
declined 17% to € 281 million in 2009 versus € 337 million in 2008.
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01
OTHER BUSINESSES AT A GLANCE
€ IN MILLIONS
2009 2008 Change
Net sales 1,283 1,285 (0%)
Gross profit 506 543 (7%)
Gross margin 39.4% 42.2% (2.8pp)
Segmental operating profit 281 337 (17%)
Segmental operating margin 21.9% 26.2% (4.3pp)
Currency-neutral sales of Other
Businesses decline 4%
In 2009, revenues for Other Businesses
declined 4% on a currency-neutral basis.
While sales declined in the segments
TaylorMade-adidas Golf, Rockport and
Reebok-CCM Hockey, revenues increased
at Other centrally managed brands.
Currency translation effects positively
impacted revenues in euro terms. Sales
of Other Businesses remained almost
stable at € 1.283 billion in 2009 (2008:
€ 1.285 billion).
Currency-neutral sales of Other
Businesses decline in nearly all regions
Currency-neutral sales of Other Busi-
nesses decreased in all regions except
Western Europe and Latin America.
Revenues in Western Europe increased
10% on a currency-neutral basis due
to higher TaylorMade-adidas Golf sales
in the region. Revenues in European
Emerging Markets decreased 2% on a
currency-neutral basis primarily due to
lower Reebok-CCM Hockey sales which
could not be offset by higher Rockport
revenues. Currency-neutral sales in
North America decreased 5% primarily
due to sales decreases at TaylorMade-
adidas Golf and Rockport. Revenues in
Greater China declined 9% on a currency-
neutral basis due to lower TaylorMade-
adidas Golf sales. Sales in Other Asian
Markets decreased 8% on a currency-
neutral basis, impacted by declines
at TaylorMade-adidas Golf. In Latin
America, currency-neutral sales grew 3%
as a result of increases at TaylorMade-
adidas Golf.
Currency translation effects had a mixed
impact on regional sales in euro terms.
Sales in Western Europe increased 3%
to € 214 million (2008: € 208 million). In
European Emerging Markets, sales grew
3% to € 30 million in 2009 from € 29 mil-
lion in 2008. Revenues in North America
declined 2% to € 685 million in 2009
versus € 695 million in the prior year. In
Greater China, revenues decreased 3% to
€ 24 million in 2009 (2008: € 25 million).
Sales in Other Asian Markets increased
1% to € 319 million in 2009 from
€ 316 million in 2008, and revenues in
Latin America decreased 1% to € 12 mil-
lion in 2009 (2008: € 12 million).
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02
OTHER BUSINESSES NET SALES BY REGION
2% Greater China
25% Other Asian Markets
17% Western Europe
2% European
Emerging Markets
53% North America1% Latin America