Adidas share price falls after sportswear giant announces Reebok restructuring

 
Joe Hall
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Adidas Germany
Adidas bought the Reebok brand in 2005 (Source: Getty)

Adidas' share price fell by over four per cent in morning trading as the German sportswear giant announced it would be taking one-off expenses to make investments for further growth and restructure the Reebok brand.

In its third quarter report, the first set of results delivered under new chief executive Kasper Rorsted, Adidas said that net profit rose by 15 per cent from €311m recorded a year ago to €387m (£348.2m).

The better than expected results, which also saw sales rise 14 per cent to €5.4bn, were underpinned by strong growth in the US.

Read more: Adidas stand to profit as Manchester United's Paul Pogba tops shirt bestseller list

Yet the company also warned investors, who have seen their shares in the company soar by 57 per cent since the turn of the year, that it would be spending around €30m during the second half of the year to restructure Reebok and other unspecified investments to spur growth which it would said impact its bottom line by around €20m in the fourth quarter.

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Rorsted took over from former chief Herbert Hainer last month and has been under pressure to continue to deliver the growth enjoyed at the company in his predecessor's final months.

The 54-year-old Dane said the company's five-year business strategy dubbed 'Creating the New' was on course as the company announced a 20 per cent rise in brand revenue in the third quarter.

"I am extremely happy to be the chief executive of a company that is doing so well," he said.

"The great momentum across all major markets shows the strength of our strategy 'Creating the New' because it is driving significant improvements in the desirability of our brands across the globe."

He added: "Going forward, it is our job to make this fantastic company even better. We will ensure that the Adidas group remains a growth company that delivers sustainable top — and bottom — line improvements in the years to come as outlined in our long-term strategic business plan 'Creating the New'."

Adidas expects full-year net profit to come in between €975m and €1bn.

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