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Puma Q3 sales jump 10.7 percent, reaffirms FY16 guidance

By Prachi Singh

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Management

Sales at Puma increased by 10.7 percent currency adjusted to 990.2 million euros (1,082 million dollars) or 8.3 percent reported in the third quarter of this fiscal. The company said, all regions contributed to this growth with EMEA and the Americas being the main drivers. Footwear once again performed well with a currency adjusted increase of 16.4 percent.

Commenting on the third quarter trading, Bjørn Gulden, Chief Executive Officer of Puma said in the company release, “We have seen a solid improvement in the sell-­through of our products at retail in the third quarter. Sales developed a little better than expected, gross margin came in as expected and this combined with a strong discipline on the cost side resulted in a nice improvement in our earnings. With three months to go we now expect our full-­year EBIT to be in the upper half of the already communicated range of 115 million euros (125 million dollars) to 125 million euros (136 million dollars).”

EMEA and America support Q3 growth

The company said, EMEA region continued its growth, supported by strong demand for footwear products. Sales rose by 11.9 percent currency adjusted to 408.6 million euros (446 million dollars) or 8.7 percent reported with France and Germany being particularly strong. Sales in the Americas region improved by 12.2 percent currency adjusted to 342.9 million euros (374 million dollars) or 5.5 percent reported. Growth was delivered by both North and Latin America.

However, Puma said that the weakness of Latin currencies, notably the Argentine Peso, continued to impact the sales development in Euro terms. The Asia/Pacific (APAC) region achieved sales of 238.7 million euros (260 million dollars), representing a rise of 6.9 percent currency adjusted or 11.7 percent reported. The company said, China and India delivered double-­digit growth.

Footwear sales rise for ninth quarter in a row

Footwear, Puma said, continued to drive the strongest growth among the three product segments, showing an improvement of sales for the ninth quarter in a row. Sales were up 16.4 percent currency adjusted and 12.3 percent reported and amounted to 458.8 million euros (501 million dollars), with success coming from the Ignite franchise as well as Fierce and Fenty products within the running, training and sportstyle categories.

At 377.4 million euros (412 million dollars), sales in the apparel segment increased by 10.3 percent currency adjusted or 8.8 percent reported. The company said, development of accessories was impacted by a weaker performance of Puma’s accessories business in the United States. Sales decreased by 2.4 percent currency adjusted to 154 million euros (168 million dollars or declined ­3.2 percent reported.

EBIT went up by 46.7 percent to 60.3 million euros (65.9 million dollars). Net earnings nearly doubled compared to last year´s result coming in at 39.5 million euros (43 million dollars), representing an increase of 98 percent. This result translates into earnings per share of 2.64 euros (2.89 dollars) compared to 1.34 euros (1.47 dollars) in the third quarter of 2015.

Sales for nine months period up 10.2 percent

Sales for the nine-­month period improved by 10.2 percent currency adjusted to 2,668.5 million euros (2,916 million dollars) or 6.4 percent reported driven by positive development were EMEA and APAC and footwear and apparel segments. The growth dynamic in the EMEA region, Puma said, was particularly high, where sales went up 13.2 percent or 9.8 percent reported due to the performance of France and the DACH area (Germany, Austria, Switzerland) which achieved a double-­digit growth. Within the EEMEA region, Russia and South Africa performed very well. Apparel achieved major gains, partly driven by the football business.

In the Americas region, both North and Latin America posted currency adjusted sales rise of 7.6 percent. In Euro terms, however, sales grew only by 0.4 percent, as the weakness of currencies in Latin America, notably in Argentina, continued to have a negative impact on reported sales. The development of sales in the Asia/Pacific (APAC) region was particularly positively influenced by China, which performed strongly across all distribution channels. The region’s sales improved by 9.3 percent currency adjusted and 10.3 percent reported.

Footwear sales improved by 11 percent currency adjusted or 5.7 percent reported, while apparel sales increased 12 percent currency adjusted or 8.6 percent in euro terms. Accessories were up 5.4 percent currency adjusted or 3.8 percent reported.

The operating result (EBIT) improved by 32.9 percent and net earnings improved by 61.5 percent and amounted to 67 million euros (66 million dollars). This result translates into earnings per share of 4.48 euros (4.90 dollars) compared to 2.77 euros (3.03 dollars) in 2015.

Puma reveals positive outlook for FY16

With positive performance over the first nine months of 2016, the company continues to expect a currency adjusted high single-­digit increase of net sales, a gross profit margin on previous year’s level (45.5 percent), and an increase of currency adjusted operating expenses in a mid to high single-­digit range for the full-­year. In light of the operating result (EBIT) achieved in the first nine months, it now expects the full-­year EBIT to be within the upper half range.

Summary
Q3 Revenues up 990.2mn euros
Nine-months revenues rise 2,668.5mn euros

Picture:Puma

Puma