The sporting goods manufacturer Puma will present business figures for the second quarter on Wednesday, July 27th. What to expect
What the company expects:
So far, the Adidas competitor cannot complain about a lack of demand. In the first quarter, consumer demand still exceeded supply, and Puma started the year with strong sales and earnings growth. Despite supply chain problems, the drivers are the Americas and Europe. In the USA, the re-entry into the basketball business a few years ago is increasingly paying off for the brand with the big cat.
The development was slowed down by the ongoing problems in China. In addition to the continuing political tensions with the western world, which are causing the Chinese to increasingly turn to domestic brands, the renewed outbreak of the corona pandemic is now putting an additional strain on business.
Puma has recently remained cautious for the year as a whole. Group CEO Björn Gulden admitted in the first quarter that the company would usually raise its forecasts after such a strong quarter. However, factors of uncertainty are the corona situation in China, the war in Ukraine, the ongoing tense freight situation and the inflation and cost pressure. In addition, it is uncertain how the consumer environment, which has recently deteriorated significantly in the current situation, will affect business. Recently, Gulden had been optimistic here.
Puma expects currency-adjusted sales to increase by at least ten percent in 2022. The operating result is expected to increase from EUR 557 million in the previous year to between EUR 600 and 700 million.
That’s what analysts expect
Market observers expect further increases in sales and profits for the second quarter. In a consensus compiled by the Bloomberg news agency, the experts assume that sales will increase to almost EUR 1.9 billion compared to almost EUR 1.6 billion in the previous year. At around 133.6 million euros, they also see EBIT significantly higher than the 108.9 million euros in the previous year. The bottom line is that you see an increase in profit from 48.7 million to 71.5 million euros.
JPMorgan analyst Grace Smalley expects the industry’s sales to be robust on the back of customer demand and inventory replenishments in North America and Europe, but sees problems with profitability. On the other hand, Piral Dadhania of the Canadian bank RBC considers the outlook for the reporting season of the sporting goods companies to be difficult in view of the declining consumer sentiment. The debate revolved in particular around a possible weakness in demand from North America and the effects of the corona easing in China.
Analyst Jörg Frey from Warburg Research was optimistic about Puma. Despite cutbacks in China due to the lockdown, the sporting goods manufacturer will clearly leave the competition behind. In addition, Puma will benefit from the weak euro. Cedric Lecasble of the investment bank Stifel thinks Puma is much more robust compared to Adidas, but Puma could also lose profitability in the quarter. The expert assumes that Puma will confirm the annual targets. Antoine Riou of French bank Societe Generale expects the Herzogenaurach-based company to have posted strong results again in the second quarter. For the year as a whole, the operating profit target should now be at the upper end of the range between 600 and 700 million euros, he believes. (dpa)