World Cup boost: Sponsor Adidas sees 8% rise in sales this year

German sportswear company Adidas has given a more precise sales growth target for 2014, amounting to a rise of up to 8 percent, as it gets a lift from the soccer World Cup that starts in Brazil next month.

As a World Cup sponsor, Adidas provides the official match ball and is kitting out nine teams of the 32 finalists, including former world champions Spain, Germany and Argentina.

“This year we will add 1-1.2 billion euros ($1.4-1.6 billion) to operational revenue, with the World Cup playing an important role,” Chief Executive Herbert Hainer told journalists at a briefing in Munich in remarks released for publication on Thursday.

That increase represents a rise of 7-8 percent from the 14.492 billion euros of sales Adidas recorded in 2013. Previously, Adidas had guided for a “high single-digit” increase in currency-neutral sales in 2014.

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The world’s second-biggest sportswear firm has been losing market share in western Europe, its home territory, to Nike, which is also challenging the German company’s dominance in the soccer market.

Nike is supplying teams from 10 countries, including the Brazilian hosts, at the World Cup.

Hainer confirmed that Adidas expected to make a record 2 billion euros of sales in football this year, exceeding Nike’s estimated $2 billion of soccer turnover.

“Football is the DNA of our company. We want to clearly show that we are number one in football,” Hainer said, adding Adidas expected to sell significantly more balls than at the last World Cup in South Africa four years ago and about as many shirts.

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Hainer acknowledged, however, that Adidas faced a “head-to-head” race with Nike in the business for football boots, including in Germany, predicting Adidas would sell 2 million pairs of special boots designed for the World Cup.

Argentina’s Lionel Messi and Germany’s Mezul Ozil are among the stars wearing Adidas boots, while Brazilian idol Neymar and Portugal’s Cristiano Ronaldo will be sporting Nike shoes.

Adidas is investing a “double-digit million sum” in advertising associated with the World Cup with a particular focus on social media, he said, with plans for a media room in Brazil to deliver and filter content from its sponsored teams and players.

Reuters