Troubles in Russia take €100 million toll on adidas
10/11/2014
While sales increased 18%, negative effects from the rouble, higher promotional activity as a result of weakening consumer sentiment and efforts to accelerate inventory reduction significantly impacted our margins.
“We have an enviable and strong position in Russia/CIS, being one of the most established and desired consumer brands with a wide-reaching network of over 1,100 stores,” he said.
“While we firmly believe in the long-term potential of the market, due to the rapid depreciation of the Russian rouble, which hit a record low, and the considerable risk of further deterioration in consumer spending, the short-term fundamentals of the business have changed materially. This warrants an even heightened level of capital and risk management as we plan for 2015.”
The group has closed 27 stores in the region since the end of June, and aims to reduce inventories by a double-digit percentage rate in 2014.
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