GERMANY'S Adidas AG - basking in good publicity from the Olympics - said yesterday net profit rose 40 per cent in the first half of 1996 but noted a marked slowdown in second quarter earnings due to costs for the Atlanta games.
Adidas said net profit for the first six months of the year jumped to DM184 million (£80 million) from DM131 million in the same period of 1995. But second quarter earnings grew by just 11.7 per cent to DM57 million.
Sales during the first six months of the year rose 28.3 per cent to DM2.24 billion, with stronger growth of nearly 40 per cent to DM1.05 billion in the second quarter.
The Herzogenaurach based sportswear manufacturer had warned that advertising costs for the Atlanta Olympics and also the European football championships in June in England would stunt its earnings growth in the traditionally weak second quarter.
Adidas chief executive, Mr Robert Louis Dreyfus, said yesterday the company, famous for its three striped logo, would spend about 10 per cent of its 1996 gross sales on promotions, with the bulk having been targeted at the two major events.
Adidas sponsored 33 national delegations to the Olympics and some 6,000 athletes wore the company's clothing at the Atlanta games.
Germany, which won the European football tournament, was exclusively equipped with Adidas footwear and clothing.
The company hinted at some of the costs for the events, saying selling and administrative costs totalled DM350 million during the second quarter, an increase as a percentage of net sales to 33.5 percent in 1996 from 32.4 per cent in 1995.
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