adidas Group: Q3 sales in line with consensus, slightly better on margins
BUY, Fair Value EUR93 (+12%)
Following ADS’ PW at end-September, 9M results met expectations with unhelpful Q3 results: FX-neutral sales remained flat as in H1, impacted by a soft summer in the US (~23% of sales) and logistic issues in Russia (~8% of sales). Despite adverse currencies (-7pp on sales), the GM has significantly increased in Q3 (+190bp vs. +210bp in H1) whilst Russia and Retail expansion weighed on the EBIT margin (Q3: +10bp to 11.9% vs. +60bp in H1). At the conference call at 3pm (CET) today, management should confirm an upbeat Q4, driven by innovation and the first deliveries of products dedicated to the 2014 World Cup. 2013 targets are all confirmed.
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