German apparel behemoth Adidas unveiled a fresh share repurchase programme and reported stronger-than-expected fourth-quarter profits. This is seen as an effort to sustain its momentum with new running and football items, as well as vintage trainers.In a statement of preliminary numbers released late on Thursday, the German sportswear company reported an operating profit of €164 million ($196 million) for the fourth quarter. This resulted in a full-year operating profit that was somewhat higher than its October prediction and above analyst estimates.
The business also announced a €1 billion share buyback programme, which will begin in February and be funded by this year’s cash flow. It aims to terminate the repurchased shares, it added.
Read Also: Elon Musk’s SpaceX to consider merger with Tesla: claim reportsHowever, currency-neutral sales for the quarter only came in at €6.08 billion, falling short of analyst projections.
The weaker US dollar and tariffs have hurt Adidas’s performance; last year, currency fluctuations cost the company more than €1 billion in revenue, according to the company.Following the end of European trade, the company’s depositary receipts in the United States increased by 1.5%. Over the past year, Adidas shares have dropped by over 40%.
The business also announced a €1 billion share buyback programme, which will begin in February and be funded by this year’s cash flow. It aims to terminate the repurchased shares, it added.
Read Also: Elon Musk’s SpaceX to consider merger with Tesla: claim reportsHowever, currency-neutral sales for the quarter only came in at €6.08 billion, falling short of analyst projections.
The weaker US dollar and tariffs have hurt Adidas’s performance; last year, currency fluctuations cost the company more than €1 billion in revenue, according to the company.Following the end of European trade, the company’s depositary receipts in the United States increased by 1.5%. Over the past year, Adidas shares have dropped by over 40%.
Adidas’s goals have been met with scepticism by investors, with some experts speculating that the global shoe boom that has been going on for years is waning.
Gulden hopes Adidas can continue to gain market share from competitor Nike Inc., which is attempting to make a comeback following years of hardship. Both businesses want to profit from the upcoming World Cup of football.
Adidas will announce its full financial results and issue early forecasts for this year on March 4.
(Edited by : Juviraj Anchil)
