Adidas has seen a spurt in sales by 16 per cent in the first quarter of 2017 in comparison to the same period last year. The company’s operating profit increased 29 per cent during the first quarter. As a result, the operating margin improved 0.9 percentage points to 11.1 per cent. However, its gross margin decreased 0.2 percentage points to 49.2 per cent as against 49.4 per cent for the same period in the previous year.

For 2017, Adidas expects sales to increase at a rate between 11 per cent and 13 per cent driven by double-digit growth in Western Europe, North America and Greater China. Gross margin is forecast to increase up to 0.5 percentage points to a level of up to 49.1 per cent. Gross margin will mainly benefit from the positive effects of an improved pricing, product and regional mix as well as further enhancements in the company’s channel mix.

Operating margin is forecast to improve between 0.6 and 0.8 percentage points to a level between 8.3 per cent and 8.5 per cent, reflecting the projected gross margin improvement as well as an expected decline in other operating expenses as a percentage of sales. As a result, operating profit is expected to grow between 18 per cent and 20 per cent.