Puma is celebrating a rebound of sales and profitability in the third quarter, boosted by additional demand following a weak second-quarter, but the group is entering the final three months of the year with caution due to continued uncertainty surrounding Covid-19.
During the third quarter, Puma booked a 13.3% currency-adjusted increase in sales to EUR1.6bn (US$1.8bn). Sales were up 7.2% on a reported basis.
Operating profit (EBIT) increased 16.8% from EUR162.2m to EUR189.5m thanks to strong sales growth combined with operating leverage and despite a lower gross profit margin, which declined by 270 basis points to 47% mainly caused by negative currency impacts, more promotional activities, and an unfavourable regional mix effect. Net earnings grew 13% to EUR113.6m.
During the quarter, Puma witnessed a strong sales increase in the Americas (+20.7%) and EMEA (+17.7%). Sales in Asia/Pacific declined by 1.9%, caused by slower growth in Greater China and a sales decline in India, Korea and South East Asia.
Footwear, apparel, and accessories all showed strong growth in the third quarter, improving by 13.9%, 8.8% and 23% respectively.
Bjørn Gulden, CEO of Puma, said: “The third quarter developed much better than I expected. Retail stores reopened, sports events resumed, consumer confidence improved and our sales increased week by week. I feel this strong performance confirms the strength of both Puma as a brand and the sporting goods industry in general.
“Despite a very promotional market environment and currency developments that put pressure on our margins, we were even able to improve our EBIT compared to last year. This was achieved by continued strong cost control that we initiated in the extremely weak second quarter and through less but more efficient marketing activities.”
Gulden added October started well, but noted the recent development of Covid-19 and the number of infections globally make Puma cautious for the rest of year.
“We will continue to manoeuvre through this pandemic in the short-term without hindering Puma’s mid-term momentum.”
As the development for the coming weeks continues to be unpredictable, Puma said it cannot provide a reliable financial outlook for the full year.