Reebok 2014 Annual Report Download - page 154

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2014
Subsequent Events and Outlook
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03.4
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adidas Group
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2014 Annual Report
Group Management Report – Financial Review
Currency-neutral Wholesale revenues to grow at a mid-single-digit rate
We project currency-neutral Wholesale revenues to increase at a mid-single-digit rate compared
to the prior year, with sales increases at both adidas and Reebok. Our growth expectations are
supported by our order backlog development as well as positive retailer and trade show feedback.
adidas Group currency-neutral Retail sales are projected to be around the prior year level. While
comparable store sales are expected to remain stable compared to the prior year, the Group
expects a net decrease of its store base of around 70 adidas and Reebok stores in 2015. We plan to
open around 220 new stores, depending on the availability of desired locations. Approximately 290
stores will be closed over the course of the year, primarily in Russia/CIS. Around 100 stores will be
remodelled.
Currency-neutral sales of Other Businesses to grow at a double-digit rate
In 2015, revenues of Other Businesses are expected to increase at a double-digit rate on a currency-
neutral basis, driven by double-digit currency-neutral sales increases at TaylorMade-adidas Golf.
After a year characterised by high inventory levels and discounting activities, TaylorMade-adidas
Golf will see major product launches in core categories such as metalwoods and irons throughout
the year. In addition, new product introductions in footwear should support growth at TaylorMade-
adidas Golf. Currency-neutral sales at Reebok-CCM Hockey are expected to grow at a mid-single-
digit rate, supported by new product introductions in the key categories skates and protective
equipment.
Group gross margin expected to be negatively impacted by currency movements
In 2015, the adidas Group gross margin is forecasted to be at a level between 47.5% and 48.5% (2014:
47.6%). Higher product margins at TaylorMade-adidas Golf as a result of lower levels of clearance
activity as well as a more favourable pricing and product mix at both adidas and Reebok are
expected to positively influence the Group’s gross margin development. However, adverse currency
movements in emerging markets, in particular in Russia/CIS, are expected to negatively impact
the Group’s gross margin development. The wider than usual target corridor reflects the currently
persisting high degree of uncertainty regarding future currency movements.