By Holger Elfes
Nov. 4 (Bloomberg) -- Adidas AG, the world’s second-largest sporting-goods maker, will start selling a soccer boot co- designed by former France captain Zinedine Zidane this month as part of a plan to generate record sales from the 2010 World Cup.
The Predator X boot is the 10th version of a series that started in 1994 and was worn by Zidane during his team’s triumph at the 1998 tournament. Adidas will back new products that also include balls and jerseys with increased marketing spending from this quarter, Chief Executive Officer Herbert Hainer said today.
“Until the championship starts, we will burn a firework of new products, beginning this month,” Hainer told a conference call after the Herzogenaurach, Germany-based company released earnings for the third quarter that topped analysts’ estimates.
Adidas is aiming to beat record soccer-related sales of 1.3 billion euros ($1.92 billion) in 2008, when the last European Championship was held. The CEO expects “positive growth” for the soccer business next year, he told Bloomberg Television. The World Cup will be played in South Africa starting June 11.
The new Predator boot will cost “clearly” more than 100 euros, according to Adidas. The shoe features rubber strips on the front which the maker says increases shooting power and makes contact with the ball more precise.
Next week, Adidas will present the jersey to be worn by Germany’s World Cup team, the first of 12 national sides that the company expects to outfit at the tournament.
Adidas is the sponsor of the World Cup and outfits officials, referees and teams including European champion Spain and host South Africa. Soccer revenue was more than 1.2 billion euros in 2006, when the global tournament was last played.
Profit Margins
The fourth quarter will still be profitable after the rise in marketing expenses, Hainer said. Operating margins this year will be about 5 percent, the CEO also said, down from 9.9 percent in 2008, though ahead of some analysts’ estimates.
“We believe this is connected to positive restructuring effects and a significant gross margin swing in the fourth quarter -- less clearance, first sales connected to the World Cup with relatively high margin-levels,” Robert Greil, an analyst at Merck Finck & Co. in Munich, wrote in a report today. He said he had expected a margin for the year of 4.6 percent.
Adidas, based in the southern-German town of Herzogenaurach, is the world’s largest maker of soccer-related sporting goods.
To contact the reporter on this story: Holger Elfes in Dusseldorf at helfes@bloomberg.net.
Last Updated: November 4, 2009 08:15 EST
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