Frankfurt: Germany’s Adidas said it would cut the number of its Reebok stores in India by about one-third as it restructures operations in the country after discovering “irregularities” at Reebok India.
While the Adidas group as a whole surpassed expectations for first-quarter results, Reebok saw sales in the first three months down 7 percent on a currency neutral basis, Chief Executive Herbert Hainer said in a speech.
German sportswear maker Adidas reported a strong rise in first-quarter profits but warned full-year earnings would be hit by the discovery of irregularities in its Indian business. Looking ahead to the whole of 2012, however, the company said "commercial irregularities" had been discovered at the Indian branch of its Reebok subsidiary which would likely affect its full-year results. AFP
“Although Reebok has some challenges to overcome in Western Europe this year and as retailers currently focus on the major sporting events, we nevertheless continue to see good progress in most other regions,” Hainer said.
Adidas, the world’s second largest sporting goods company behind Nike, announced the irregularities at Reebok India on Monday, also releasing first quarter earnings ahead of schedule.
It surpassed expectations with sales of 3.8 billion euros and operating profit of 409 million and also increased its outlook for 2012.
Reuters
