Operating expenses were down 20% to € 185 million, reflecting a decline in both operating overhead costs and marketing expenditure. Shareholders' equity decreased 6% to € 6.230 billion at the end of June 2020 (2019: € 6.619 billion) due to the share repurchases at the beginning of the year and the decline in net income. As at June 30, 2020, the loss allowance for not credit-impaired accounts receivable in the amount of € 206 million and credit- impaired accounts receivable in the amount of € 2 million was not recognized as adidas holds credit enhancement instruments, mainly in the form of credit insurance and bank guarantees, which mitigate the credit risk of those financial assets.
During the period from January 1, 2020 to June 30, 2020, the nominal capital of adidas AG remained unchanged. 60 million is related to the collective loss allowance mainly due to a deterioration of the accounts receivable ageing structure as well as higher allowance percentages due to an increase in the expected default rates. adidas annual report project for my final portfolio. On a currency- neutral basis, operating working capital was up 10%. Changes in the statement of financial position are discussed in relation to the respective positions at the end of June 2019. Accounts payable were up 22% to € 2.575 billion (2019: € 2.111 billion), reflecting measures to manage cash outflows during the coronavirus pandemic. This development was driven by the operating loss and the increase in operating working capital, which were both results of the coronavirus pandemic. This development was due to cash used in operating activities, partly offset by an increase in. As the coronavirus spread globally, the corresponding store closures significantly weighed on the first half year sales developments also in Emerging Markets (- 33%), Latin America (- 31%), Europe (- 23%) and - to a lesser extent - North America (- 19%) and Russia/CIS (- 14%). The effective tax rate has been determined based on the year to date pre-tax earnings for the first half of 2020. New accounting standards and interpretations as well as amendments to existing standards which are not yet effective in the EU or effective for financial years beginning after January 1, 2020 are not expected to have any material impact on the consolidated financial statements. A favorable channel, category and pricing mix as well as lower sourcing costs more than offset purchase order cancellation costs. As at June 30, 2020 adidas had not made use of the syndicated credit line. The company applied all International Financial Reporting Standards issued by the International Accounting Standards Board (IASB) and Interpretations of the IFRS Interpretations Committee effective as at June 30, 2020 insofar as they have already been adopted into European law. Operating expenses as a percentage of sales declined 1.1 percentage points to 37.3%. Issuu company logo. SEE TABLE 7, Gross margin in Russia/CIS was down 1.3 percentage points to 60.2%, as an unfavorable channel and pricing mix as well as negative currency developments more than offset lower sourcing costs. Total non-current liabilities decreased 4% to € 4.693 billion at the end of June 2020 (2019: € 4.892 billion).
Ultimately, consumer confidence has plummeted in light of strongly reduced economic activity across the globe. € 600 million thereof was provided by the core banks of adidas and € 2,400 million by KfW, Germany's state-owned development bank at customary market conditions.
Consequently, the company's equity ratio decreased 3.7 percentage points from 34.3% to 30.7%. Consequently, both basic and diluted EPS from continuing and discontinued operations were negative € 1.35 (2019: positive. The individual loss allowance increased by € 74 million to reflect a higher credit risk of specific customers. Fixed assets were down 1% to € 7.739 billion (2019: € 7.806 billion). In addition, an increase in inventory allowances as well as purchase order cancellation costs had a negative impact on the gross margin development.
SEE FINANCIAL HIGHLIGHTS, P. 03, In the first half of 2020, net cash used in operating activities was € 824 million (2019 net cash generated: € 1.011 billion). Operating overhead expenses remained flat at € 3.230 billion (2019: € 3.215 billion). Impairment losses for the first six months ending June 30, 2020 in the amount of, Goods in transit mainly relate to shipments of finished goods. Operating expenses were up 2% to € 149 million, reflecting an increase in operating overhead costs. In light of the challenges posed by the coronavirus pandemic, the Executive Board and Supervisory Board of adidas AG deem it necessary to protect the company's capital and liquidity base by waiving the payment of a dividend. SEE TABLE 1 The operating profit development in the first half of 2020 was significantly impacted by several coronavirus-related charges. Net debt at June 30, 2020 amounted to € 792 million, representing a decline of € 1.154 billion compared to net cash of € 362 million at the end of June 2019. Structure of book is accoridan fold with story on the front and financials in the back. Due to the use of treasury shares with the exclusion of subscription rights, adidas AG was able to acquire the intellectual and intangible property rights (or licenses) from their owner at attractive terms while preserving the company's liquidity.