10:00AM New York - Adidas reported net income for the first quarter of 2008 increased 32% to €169.

Earnings Review

Adidas AG reported that first quarter revenue climbed 3% to € 2.621 billion from € 2.538 billion in 2007 on 10% sales growth.

In the latest quarter, the group''s net income attributable to shareholders increased 32% to €169 million from €128 million last year driven by strong operating margin improvement and lower net financial expenses.

A decline in quarterly tax rate by 0.4 percentage points to 32% from 32.4% in the prior year also contributed higher income.

Basic earning per share rose 33% from a year earlier to € 0.84 008 up from € 0.63.

The groups operating margin soared 1.7 percentage points to 10.8%.

For the quarter, operating expenses as a percentage of sales increased 0.5 percentage points to 39.2% of sales.

Operating profit increased 23% to reach €282 million against €229 million in 2007.

The group bought back 3.2 million shares at an average price of €42.03 and the buyback volume amounted to €134.8 million during the period under review.

Over the entire buyback period, since January 30 to date, Adidas AG bought back 5.5 million shares at an average price of € 41.73. The total buyback volume amounted to € 229.9 million.

First quarter net borrowings stood at €2.073 billion, down 18% or € 446 million compared with €2.519 billion in the prior year.

Revenue Review

The group''s sales increased 10% on a currency-neutral basis, driven by double-digit sales growth in the Adidas and TaylorMade-adidas Golf segments.

However, revenues in the Reebok segment, declined. The group sales in euro terms were adversely affected by currency movements.

In the quarter, Adidas and TaylorMade-adidas Golf segments set the pace for the Group''s sales growth in the first quarter of 2008.

Adidas revenues increased 14% on strong performance product sales in nearly all major categories.

Reebok segment fell 6% as a result of Reebok''s repositioning efforts in the USA and the UK.

At TaylorMade-adidas Golf, revenues surged 17%, due to the strong product offering in all major categories as well as new product launches.

Business Review