Adidas-Salomon CEO Herbert Hainer was quoted in a Reuters report that the adidas is expecting flat sales in the U.S. in 2004, and may even be “slightly positive”. He said they expect to see “first signs of improvement” in the second half and that it will continue into 2005.

“The worst is over but the U.S. business will not turn overnight,” Hainer was quoted in the report.

The comments come on the heels of adidas’ launch of a $50 million ad campaign to re-build brand awareness in the U.S.
In late January, Hainer stated that “This year, we will stabilize our business in North America, grow Group sales by 3 to 5% on a currency-neutral basis and deliver net income growth of at least 10%.” Those comments came as adidas-Salomon reported its preliminary results for 2003 and Hainer reportedly reiterated that guidance last week.

The company had reported that sales are expected to be down 3.8% to €6.2 billion ($7.1 bn) from €6.52 billion ($6.2 bn) in 2002. Currency-neutral sales were up 5.0%. Currency-neutral sales increased for all brands and regions, except North America. adidas had reported a 35% drop in U.S. futures backlog a the end of the third quarter.

In December, the company announced that Erich Stamminger, a Member of the Executive Board of adidas-Salomon responsible for Global Marketing, had been appointed president and CEO of adidas America.

The company is apparently looking to the stronger Euro to deliver some of the profit increase this year. Hainer said he expected the Euro to continue to rise, possibly reaching €1.30 to the dollar.

“I see some upside potential for 2004,” said Hainer of the gross margin percentage, which was 44.9% in 2003, up 170 basis points from gross margin of 43.2% in 2002.
Hanier also hinted that the company will announce a “positive surprise” in its debt reduction levels which stood at €1.4 billion at the end of third quarter.

He also pointed to the rumored return to performance product as a positive sign for adidas. “We are much more balanced than a lot of companies,” he said in the interview. “Some of those who are now riding the fashion wave will have trouble in the next 12 to 24 months. There are already indications that technical running shoes are coming back.”


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