By Jonathan Davies
Everything appeared to be going well for Adidas. In June, the sportswear retailer said the World Cup gave its profits a huge boost, two of its teams - Germany and Argentina - made it to the World Cup Final, and it announced a record breaking £750m deal to supply Manchester United's kits from the 2015-16 season.
But it appears that the ever-growing geopolitical tensions between Russia and what seems like the rest of the world is taking its toll on Adidas.
"The recent trend change in the Russian rouble, as well as increasing risks to consumer sentiment and consumer spending from current tensions in the region point to higher risks to the short-term profitability contribution from Russia," Adidas said in a statement.
Perhaps shockingly, Adidas is now planning to stall some of its growth plans and accelerate some stores closures in Russia.
"As a result, Management has decided to significantly reduce its store opening plan in the market for 2014 and 2015 and to further increase the number of store closures."
Investors reacted badly to the news with shares falling by 14% in early trading.
"Taking these developments and initiatives into account, Management now expects a mid-to-high single digital currency-neutral sales increase (it had previously forecast high single digit growth) for the full year 2014 and net income attributable to shareholders to be at a level of around €650 million (previous forecast at €830m-€930m)."
It isn't all bad news for the German sports brand. It is still planning to press ahead with expansion plans around the world.
"Following the strong performance at the 2014 FIFA World Cup, and improving momentum at brand adidas and Reebok, Management has decided to step up marketing and point-of-sale investment over the next 18 months to secure and drive faster growth rates and market share gains, particularly in the developed markets such as North America and Western Europe," Adidas said.
Adidas will announce its full financial report of the second quarter on 7 August.
Join us on