German sportswear company Puma SE has adopted a cautious outlook for the 2025 fiscal year. This is evident from the latest forecasts, which the company released in an ad-hoc announcement on Tuesday evening. According to the announcement, weak figures in the US and China have recently impacted business performance.

Management anticipates "continued geopolitical tensions and economic challenges, particularly with regard to trade tensions and currency volatility," Puma stated. Therefore, the company expects only "currency-adjusted sales growth in the low to mid-single-digit percentage range" for the full year.

Special Items Impact Operating Results

Current projections suggest that operating profit will likely fall short of the previous year's level. For 2025, the sportswear company forecasts adjusted earnings before interest and taxes (EBIT), excluding special items, in the range of €520 to €600 million. In 2024, EBIT reached €622.0 million.

Reported EBIT will only reach €445 to €525 million due to one-off charges related to the "Nextlevel" cost-cutting program launched at the beginning of the year, which the company estimated at up to €75 million. No special items were recorded in the most recent fiscal year.

Weak Business in the US and China Impacted Performance in the First Quarter

The reasons for the cautious outlook stem from business performance since the start of the year. For the first quarter, management forecasts only "currency-adjusted sales growth in the low single-digit range, below the prior-year level." This is "primarily due to weak business performance in the US and China."

Adjusted EBIT in the first quarter is expected to decline to approximately €70 million due to "effects from the valuation of inventories in the previous year, a higher operating expense ratio, and different timing of marketing expenses." Including the one-off charges, reported EBIT will therefore "likely be significantly below the prior-year level." In the first quarter of 2024, it reached €159.0 million.

Consolidated Net Earnings Decrease by 7.6 Percent in Fiscal Year 2024

On Wednesday morning, the company then presented its final results for the past fiscal year. These offered no major surprises, as Puma had already pre-released key figures in January.

For the full year, sales increased by 2.5 percent (currency-adjusted +4.4 percent) to €8.82 billion. According to the company, this was driven by growth "across all regions, product divisions, and distribution channels."

The gross profit margin, which was 46.3 percent in 2023, rose to 47.4 percent. "Negative impacts from currency effects and promotional activities were more than offset by a favorable product and distribution channel mix, as well as lower sourcing and freight costs," Puma explained.

EBIT amounted to €622.0 million, remaining virtually unchanged compared to the previous year (+0.1 percent). Consolidated net earnings decreased by 7.6 percent to €281.6 million, "primarily due to higher interest expenses and an increase in the result attributable to non-controlling interests."