” Lfuck it, it always flies in a squadron “. This formula of former President Jacques Chirac, Adidas could take it up on its own, as the difficulties accumulate on its way. Latest: the umpteenth skid of Kanye “Ye” West. Together, they have been collaborating since 2013. And the line of sneakers, called Yeezy, once marketed by Nike, is a hit, especially with young people. The agreement between the German and the ex-Mister Kardashian runs until 2026, but it could be interrupted suddenly. On Friday October 7, Adidas announced in a press release that it wanted to “reassess your partnership”. It must be said that the American rapper and stylist, decked out with the sweet nickname of “jackass” by Barack Obama, multiplies the slippages: anti-Semitic remarks, t-shirts branded with white supremacist remarks (“White Lives Matter”, the life of whites is important , in French), provocations against Adidas itself… “A successful partnership is based on mutual respect and shared values”, believes the German group, disappointed. More than whimsical, Kanye “Y” West is freewheeling, having no filter left.
Disappointment in sight
This file is added to a pile as high as a size 48 basketball: drop in sales in China – a consequence of Beijing’s zero Covid policy and calls for a boycott from local consumers -, increase in unsold stocks, rise in prices of purchase and logistics costs, search for a new manager after the announced departure of Kasper Rorsted… In short, a squadron of difficulties, which ended in disappointing third quarter results. They will be known on November 9. ” We expect growth at constant exchange rates of 6% to 6.5 billion euros. This reflects a double-digit increase in the EMEA region [Europe, Moyen-Orient, Afrique, ndlr.] and in North America. However, we believe that excess inventory in China has led to product repossessions. China is therefore expected to experience a 25% drop “, predicts the analyst from the Oddo BHF office in a note published Tuesday morning. The gross margin should be eliminated by 160 basis points and the operating margin by 230 basis points, according to the expert’s calculations. Cautious for 2022 and 2023, he underlines that the context of consumption, weighed down by inflation, and promotions to sell stocks will weigh on the performance of the equipment manufacturer, in particular in Europe and North America. “Neutral” on the file, Oddo BHF lowers its target price from 177 euros to 132 euros, which implies an upside potential of around 17% on the stock, which has lost half of its value (-55% ) since 1er January. If he remains buyer of the title, the firm Stifel readily acknowledges that Adidas is going through a turbulent period. ” Despite the two warnings issued, we believe that the objectives for fiscal year 2022 are still at risk writes the analyst. Our new estimates are in the low range of sales forecasts and slightly below margin forecasts. We now expect organic sales growth of 4.6%, gross margin of 48.7%, down 200 basis points [et] a net profit of 1.1 billion euros “, against approximately 1.3 billion euros expected within the German group.
CP