Adidas deliveries to retailers are being delayed by Red Sea shipping disruptions, the CEO of the sportswear company told analysts, adding that soaring freight rates are weighing on gross margins.
CEO Bjorn Gulden stated that shipments are currently three weeks behind schedule, which is creating some delivery problems, particularly to Europe.
“The irony is we actually have products right now where the sell-through is so good with certain retailers that we can’t deliver (them),” Gulden said on the analyst call after the company reported full-year results.
The attacks on shipping in the Red Sea are causing goods businesses to avoid the Suez Canal and reroute around the southern tip of Africa. This is causing a delay in the arrival of clothing and shoes in Europe from manufacturers in Asia.
Gulden went on to say that he does not anticipate the disruption lasting very long and that it will not have a significant effect on margins.
Adidas stated that the impact was taken into account while estimating its financial impact for 2024, although it did not provide a specific figure.
