The German sporting goods provider Puma SE felt the effects of the latest currency turbulence in Argentina in the final quarter of the 2023 financial year. This had a significant impact on the preliminary annual results that the company published on Wednesday.
In view of “the extraordinary devaluation of the Argentine peso of 54 percent in December 2023,” the company applied “accounting for hyperinflationary countries,” Puma said. On this basis, sales in the past financial year increased by around 6.6 percent compared to 2022, adjusted for currency effects. In the reporting currency, the euro, revenue grew by 1.6 percent to around 8.60 billion euros.
According to the available figures, earnings before interest and taxes (EBIT) reached 622 million euros and were therefore within the forecast range of 590 to 670 million euros. The net profit, which had amounted to 353.5 million euros in the previous year, fell to around 305 million euros.
Despite recent problems, the sporting goods retailer sees “strong underlying operational development”
Without the negative effects of the exchange rate development of the Argentine peso, a currency-adjusted sales increase of over eight percent was achieved, the company explained. On this basis, EBIT exceeded the previous year’s figure of 641 million euros. “In a globally challenging macroeconomic environment, this reflects strong underlying operational development and strict cost discipline,” emphasized the sportswear retailer.
At the same time, Puma gave an initial outlook for the current financial year. The management therefore expects currency-adjusted sales growth in the mid-single-digit percentage range and an EBIT between 620 and 700 million euros for 2024 “despite the ongoing geopolitical and macroeconomic uncertainty”. The outlook is “based on the assumption that the future devaluation of the Argentine peso will be fully offset by corresponding price increases in Argentina,” the company said.