Reebok 2014 Annual Report Download - page 144

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2014
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03.3
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adidas Group
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2014 Annual Report
Group Management Report – Financial Review
Business Performance by Segment
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Retail Business Performance
Segmental operating profit decreased 1% to € 673 million in 2014 versus € 678 million in the prior
year. Segmental operating margin declined 2.1 percentage points to 17.5% (2013: 19.7%), as the
positive effects of lower segmental operating expenses as a percentage of sales were more than
offset by the decline in gross margin.
Retail development by region
Currency-neutral Retail sales increased at a double-digit rate in all regions. Retail revenues in
Western Europe grew 23% on a currency-neutral basis, mainly due to double-digit sales increases in
the UK, France, Germany and Spain. Sales in European Emerging Markets rose 18% on a currency-
neutral basis, as a result of double-digit growth in all markets. Currency-neutral Retail sales in
North America grew 15%, due to double-digit growth in both the USA and Canada. Retail revenues
in Greater China increased 26% on a currency-neutral basis. Sales in Other Asian Markets grew
19% on a currency-neutral basis, driven by double-digit growth in Japan and South Korea. In Latin
America, currency-neutral Retail sales grew 39%, with double-digit sales increases in all markets,
in particular in Argentina, Colombia and Brazil. Currency translation effects had a mixed impact on
regional sales in euro terms.
Retail development by brand
In 2014, adidas Group Retail sales increased at a double-digit rate at both adidas and Reebok.
Currency-neutral adidas Sport Performance revenues grew 22% in the period, mainly due to double-
digit growth in the football, training and running categories. adidas Originals & Sport Style sales
also rose 22% on a currency-neutral basis, driven by double-digit sales increases at both adidas
Originals and adidas NEO. Currency-neutral Reebok sales were 14% higher compared to the prior
year, driven by double-digit growth in the fitness training and Classics categories. Comparable store
sales for the adidas brand increased 10% on a currency-neutral basis, while Reebok comparable
store sales grew 1% on a currency-neutral basis. Currency translation effects had a negative
impact on revenues in euro terms. adidas Sport Performance own-retail sales increased 13% to
€ 2.112 billion in 2014 from € 1.875 billion in 2013. adidas Originals & Sport Style own-retail sales
were also up 13% to € 1.153 billion from € 1.020 billion in 2013. Own-retail sales of Reebok branded
products grew 5% to € 578 million (2013: € 549 million).
Retail store development
At December 31, 2014, the adidas Group Retail segment operated 2,913 stores compared to the
prior year-end level of 2,740. This represents a net increase of 173 stores. Of the total number of
stores, 1,616 were adidas and 446 were Reebok branded (December 31, 2013: 1,557 adidas stores,
404 Reebok stores). In addition, the adidas Group Retail segment operated 851 factory outlets
(December 31, 2013: 779). During 2014, the Group opened 409 new stores, 236 stores were closed
and 145 stores were remodelled.
see Table 08
see Table 09