Adidas sales rise 20% on back of World Cup

by Jennifer Whitehead, Brand Republic 10-Aug-06, 08:50

LONDON - Adidas is being touted as the winner in World Cup sponsorship after reporting a rise in sales of 20% to €1.8bn (£1.2bn) for the second quarter.

The German sportswear group reported a rise in first-half sales for the Adidas brand of 17% to €3.3bn. However, sales at Reebok, which it acquired at the beginning of the year in a €3.1bn deal, were down by 9% to €1.05bn.

The company attributed a strong showing at the World Cup this year for the sales growth. However, net profits for the second quarter were down by 11% to €83m, and the operating margin declined by 2.6 percentage points to 8.6% for the first half of the year.

The firm blamed this mainly on the merger with Reebok but also on higher World Cup marketing expenditure.

Addidas was an official sponsor and ball supplier of the World Cup, as well as having deals with six teams in the tournament, including runners-up France. This contrasts with the eight teams sponsored by Nike. Winning team Italy was backed by Puma.

Adidas backed its sponsorship with the Adidas +10 Teamgeist advertising campaign featuring France captain Zinedine Zidane and England captain David Beckham. In contrast, Nike ran an ad campaign with the strapline 'La Joga Bonita', featuring Eric Cantona and Ronaldinho.

Herbert Hainer, chairman and chief executive of Adidas, said: "The Adidas Group had an outstanding first half of 2006 crowned by our strong showing at the World Cup."

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