Adidas AG (ADS) fell the most in five years after the world’s second-largest sporting-goods maker slashed its 2014 earnings forecast and scrapped targets for next year amid Russian unrest and a slump in demand for golf equipment.
The shares tumbled as much as 11 percent in Frankfurt trading, the biggest drop since May 2009. Net income this year will be about 650 million euros ($870 million), Herzogenaurach, Germany-based Adidas said in a statement. The company had previously anticipated earnings of 830 million euros to 930 million euros. In addition, the company said its so-called Route 2015 targets for sales and profitability aren’t achievable by next year.
Adidas will restructure its TaylorMade golf unit “to align the organization’s overhead to match lower expectations.” The company also plans to close stores in Russia and delay other locations’ openings amid “current tensions in the region.”
Sales in the second quarter increased 2 percent to 3.47 billion euros, Adidas said. Golf sales fell 18 percent in the quarter.
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