GERMANY: Puma Q4 loss widens on one-time charges
- Q4 loss widens to EUR115.2m
- Sales fell 13.2% to EUR698.3m
- 2014 will be start of company's turnaround
Sportswear brand Puma says it expects 2014 to mark the start of its turnaround, after reporting a wider fourth-quarter loss on the back of lower sales and one-time charges.
The German company today (20 February) said its net loss widened to EUR115.2m (US$157.8m) during the last three months of 2013, compared to a loss of EUR42.6m in the same period of the prior year.
One-time charges amounted to EUR129m during the quarter. These, Puma said, related to the closure of its product development centre in Vietnam, the relocation of its international product functions from London, and the intended centralisation of its global and European retail operations from Switzerland to its Herzogenaurach HQ.
Sales fell 13.2% to EUR698.3m, mainly due to weakening currencies in Japan, Russia, Turkey and various countries in Latin America.
For the full year, net earnings slumped 92.4% to EUR5.3m from EUR70.2m a year earlier, while sales fell 8.7% to EUR2.99bn from EUR3.27bn.
Commenting on the results, CEO Bjoern Gulden said: "2013 has been a challenging year for Puma and there is no doubt that we have issues in terms of lack of brand heat, commercial products and desirable distribution.
"Nonetheless, Puma is a great brand and with our new brand positioning as the fastest sports brand in the world, we have a clear vision of where we want to go."
Puma expects net sales to be flat in 2014, but with "improved revenue quality", while gross margin is forecast to improve slightly, due to sourcing improvements and favourable changes in the product mix.
"This is not a quick fix, but 2014 marks the start of the turnaround," Gulden added.
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