(Adds details, background)
BERLIN, May 11 (Reuters) - Adidas AG ADSGn.DE said on
Wednesday it is ending its sponsorship of English soccer side
Chelsea six years early, opening the door to an unnamed rival
and prompting the German sportswear firm to raise its full-year
profit forecast.
Adidas, which has sponsored Chelsea since 2006, said it had
reached a mutual agreement to end the deal on June 30, 2017
year, instead of in 2023 as originally agreed, allowing the club
to enter into a new agreement with an unnamed competitor.
It said the move was in line with a strategy shift announced
last year to partner with fewer teams as it moves more of its
marketing budget towards top individual players, digital media
and grassroots campaigns.
Adidas agreed in 2014 to pay 750 million pounds ($1.08
billion) to replace Nike (NYSE:NKE) as sponsor of English soccer side
Manchester United for a decade, a record kit deal for the sport.
It has also taken over from its U.S. rival at Italian champions
Juventus, while extending its contract with Germany's No.1 team
Bayern Munich.
As compensation for early termination of contract, Adidas
will receive a payment from Chelsea in 2017 that will lift its
net income in the second quarter by a sum in the
mid-double-digit million euros. It did not say how much the
compensation payment would be.
Adidas said the group's net income from continuing
operations is now forecast to increase by around 25 percent in
2016, to around 900 million euros ($1.03 billion), more than the
15-18 percent rise previously targeted.
Its operating margin is now projected to increase to a level
of around 7.0 percent from a previous 6.6-7.0 percent.
($1 = 0.8740 euros)
($1 = 0.6914 pounds)