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European Earnings: Adidas Scores

Germany's Adidas was the highest flyer among European companies reporting earnings Tuesday, with shares surging 5.7 percent higher.

Adidas' first-quarter net income climbed by a third as sales of the sports apparel maker's 'Adidas' and 'TaylorMade' brands rose.

But weakness at Reebok continued in the U.S. The German company said net income rose 32 percent to 169 million euros ($261.1 million) and sales climbed 3 percent on a currency-adjusted basis to 2.621 billion euros.

Thirteen analysts in Reuters poll had forecast, on average, net income of 157 million euros and sales of 2.624 billion.

It reiterated that it expects sales to rise by a high single-digit percentage this year and net income to grow at least 15 percent above 2007's 551 million euros.

Hannover Re

Germany's Hannover Re posted a 23 percent rise in first-quarter net profiton lower costs caused by large disaster claims and a slightly higher investment result.

The company confirmed its full-year earnings targets but said it now expects flat premium income versus 2007, compared with a 5 percent increase it anticipated previously.

The reinsurer said it was on track for an after-tax return on equity of above 15 percent and earnings per share of around 5 euros.

First-quarter net profit was 151.5 million euros, up from 123.5 million euros in the first quarter of 2007.

EBIT was up 59% to 245.6 million euros from 154.2 million euros and above the forecast 214 million euros.

Hypo Real Estate

Hypo Real Estate made a further 175 million euros ($270 million) in writedowns on its portfolio of structured credits in the first quarter and said financial markets were still dysfunctional in some areas.

Pretax profit was 6 million euros in the first quarter after deducting the effect of a mandatory convertible bond.

Analysts had expected pretax profit of 29 million in the period, according to the average of 17 forecasts in a Reuters poll.

The investment bank's shares have tumbled by more than a third in value since it surprised investors with unexpected subprime-linked writedowns in January.

It has since warned that the worsening situation could throw it off course to make a 1 billion euro pretax profit this year as it had previously targeted.

Swiss Re

In Switzerland, Hannover Re's rival, Swiss Re, reported net profit dropped 53 percent in the first quarter, a bigger-than-expected fall, and the world's biggest reinsurer announced further credit writedowns of 819 million Swiss francs ($776.3 million).

Adecco

Staffing company Adecco posted a forecast-beating 3 percent rise in first-quarter net profitbut cautioned that economic weakness would weigh on its 2008 sales growth goal.

The economic slowdown in the United States, which is seen spilling into Europe, is a dark cloud hanging over the staffing sector and could overshadow Adecco's recent attempts to improve profitability by moving into the professional services market.

But the Swiss company said it was still aiming for revenue growth of at least 7 to 9 percent each year on average for the coming years and was confident it would improve the operating margin to over 5 percent by 2009.

In the first quarter, net profit edged higher to 137 million euros ($211.7 million), beating the average forecast of 122 million euros in a Reuters poll of 13 analysts, as revenues in its key France unit rose 2 percent to 1.6 billion euros.

Operating income rose 8 percent to 205 million euros on sales up 1 percent at 5.029 billion euros.

The operating margin increased by 30 basis points to 4.1 percent, Adecco added.

Holcim

Holcim, the world's second largest cement maker, posted a 4 percent rise in first-quarter net profit and said it will again reach its long-term growth goals in 2008.

Net profit for the group rose to 370 million Swiss francs ($350.7 million), ahead of the average estimate of 354 million francs in a Reuters survey of nine analysts.

Holcim said it was aiming to reach its long-term growth target of 5 percent in internal operating EBITDA in 2008, despite dearer energy, by cutting costs and hiking prices though uncertainty about the global economy remained high.

Operating EBITDA fell by 14 percent to 1.15 billion francs, though it was 0.6 percent higher when adjusted for the divestment of units in South Africa and Egypt.

Net sales were down 4 percent at 5.51 billion francs but 7.4 percent higher on a like-for-like comparison.

Veolia

Veolia reported a 7.1 percent rise in first-quarter recurring operating profit, helped by new water contracts and cold weather that lifted its energy business, but the figure was below analyst forecasts.

The world's largest listed water company said it was sticking to its 2008 targets for growth of at least 10 percent in revenue, cash flow from operations and net income despite the "unstable" global economic environment.

Veolia's operating profit rose to 701.2 million euros ($1.1 billion) from 655 million in the first quarter of 2007, which was below the average forecast of 743 million euros from seven analysts polled by Reuters.

The operating figure included the non-cash amortization of intangible assets linked to recent acquisitions, Veolia said.

But Veolia's revenue, which was up 16.6 percent year on year at 9.09 billion euros, topped market expectations since analysts had bet on quarterly sales of 8.85 billion.

Excluding the impact of foreign exchange, operating income and revenue were up 9 percent and 18.9 percent respectively.

NYSE Euronext

NYSE Euronext reported forecast-beating earnings in the first quarter and the recently merged transatlantic exchange operator said it was on course to meet a target for technology savings.

NYSE Euronext posted first quarter net profit of $230 million or $0.87per share and operating income of $348 million on revenues of $1.293 billion.

Analysts had on average forecast earnings per share of $0.83 and revenues of $1.219 billion, according to Reuters Estimates.

Lloyds TSB

And in the UK, Lloyds TSB said it was on track to deliver a good performance in the first half, excluding a writedown of 387 million pounds ($761 million) on the value of assets tarnished by the credit crunch.

The bank's 387 million-pound writedown for the quarter is a result of the global credit crunch, and adds to a 280 million pound writedown on assets last year, but it is far less than writedowns reported by most rivals.

-- Reuters contributed to this report

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