Reebok 2013 Annual Report Download - page 158

adidas Group
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2013 Annual Report
Group Management Report – Financial Review
154
2013
Subsequent Events and Outlook
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03.4
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adidas Group currency-neutral sales to increase
at a high-single-digit rate in 2014
We expect adidas Group sales to increase at a high-single-digit rate on a
currency-neutral basis in 2014. In particular, this year’s major sporting
events will provide positive stimulus to Group sales. As the Official
Partner of the 2014 FIFA World Cup in Brazil, the adidas brand will be the
most visible brand during the event and will benefit from record sales in
the football category. Group sales development will also be favourably
impacted by our high exposure to fast-growing emerging markets as
well as the further expansion of Retail. Currency translation is expected
to have a significant negative impact on our top-line development in
reported terms.
Currency-neutral Wholesale revenues expected to
increase at a mid-single-digit rate
We project currency-neutral Wholesale segment revenues to increase
at a mid-single-digit rate compared to the prior year. Our growth
expectations are supported by our positive order backlog development
as well as positive retailer and trade show feedback. Currency-
neutral adidas Sport Performance sales are forecasted to increase
at a mid-single-digit rate, driven by growth in key categories such as
football, running and basketball. adidas Originals & Sport Style revenues
are projected to increase at a mid-single-digit rate on a currency-neutral
basis, driven by the further expansion of the adidas NEO label as well as
growth at adidas Originals. Currency-neutral Reebok sales are expected
to increase at a mid-single-digit rate, mainly due to growth in fitness
training and Classics as well as the further expansion of new categories
such as studio.
Retail sales to increase at a high-single- to low-double-
digit rate on a currency-neutral basis
adidas Group currency-neutral Retail segment sales are projected
to grow at a high-single- to low-double-digit rate in 2014. The Group
expects a net increase of its store base of around 250 adidas and Reebok
stores in 2014. We plan to open around 450 new stores, depending on
the availability of desired locations. New stores will primarily be located
in European Emerging Markets, in particular Russia/CIS. Approximately
200 stores will be closed over the course of the year. Around 180 stores
will be remodelled. Comparable store sales are expected to increase at
a low- to mid-single-digit rate compared to the prior year.
Currency-neutral sales of Other Businesses to
grow at a low- to mid-single-digit rate
In 2014, revenues of Other Businesses are expected to increase at a
low- to mid-single-digit rate on a currency-neutral basis. TaylorMade-
adidas Golf currency-neutral sales are projected to grow at a low- to
mid-single-digit rate compared to the prior year. Product launches in
core categories such as metalwoods and irons as well as new product
introductions in footwear should support growth in this segment.
Currency-neutral revenues at Rockport are forecasted to increase at a
mid- to high-single-digit rate, driven by growth in core strategic product
concepts such as Total Motion and truWalkZero. Currency-neutral sales
at Reebok-CCM Hockey are expected to grow at a mid-single-digit rate,
supported by new product introductions in its key categories skates and
sticks.
adidas Group sales expected to increase in
all geographical areas
We expect the Group’s currency-neutral revenues to increase in all
of our geographical areas in 2014, however at varying growth rates.
In Western Europe, the gradual improvement in the macroeconomic
environment as well as the 2014 FIFA World Cup will positively impact
sales development in this region. In European Emerging Markets, the
expansion of and improvements in our own-retail activities, particularly
in Russia/CIS, are forecasted to have a positive influence on Group sales.
In North America, we expect momentum to improve as we move through
2014, with the adidas brand strengthening its product offering in major
categories such as running and basketball and Reebok gaining traction
with new product introductions in both footwear and apparel. In Greater
China, we expect growth to continue at similar levels to the prior year.
This development will be primarily driven by expanding and solidifying
our distribution footprint. In Other Asian Markets, growth will be driven
by markets such as South Korea, Southeast Asia and India. Finally, in
Latin America, Group sales development is projected to be positively
impacted by the 2014 FIFA World Cup.