The German sporting goods supplier Puma SE was able to present pleasing figures for the first quarter of the 2022 financial year on Wednesday. In a statement, CEO Bjørn Gulden emphasized that the company had significantly increased its sales and profits “despite all the obstacles and uncertainties” and had a “very good start” to the current year.
However, due to the ongoing challenges, management remained cautious despite the surprisingly good results: “Based on such a strong first quarter, we would normally raise our outlook for the year as a whole. In view of the increasing global uncertainty, however, we have decided to maintain our original outlook from the beginning of the year,” explained Gulden.
Despite problems in China: quarterly sales grow by 23.5 percent
In the months of January to March, Puma generated sales of 1.91 billion euros. This corresponded to an improvement of 23.5 percent compared to the same quarter of the previous year. Adjusted for exchange rate changes, revenues increased by 19.7 percent. The company achieved strong growth in the Americas, where sales increased by 52.8 percent (currency-adjusted +44.1 percent) to 815.9 million euros, and in the EMEA region, which includes Europe, the Middle East and Africa. Revenues there totaled EUR 708.8 million, exceeding the previous year’s level by 23.8 percent (currency-adjusted +25.5 percent).
In the Asia-Pacific region, on the other hand, sales fell by 12.4 percent (currency-adjusted -17.0 percent) to EUR 387.4 million. The company cited the situation in Greater China as justification. The market environment there was “shaped by Covid-19-related restrictions and geopolitical tensions,” said Puma.
Puma can clearly increase in all product categories
The sporting goods retailer was able to achieve double-digit growth in all product categories worldwide. “We achieved the highest growth rates in the performance categories such as running, soccer, basketball and golf. This confirms that our investments in innovation and marketing are paying off,” explained CEO Gulden.
Despite increased operating expenses “due to higher expenses for marketing, a larger number of own retail stores as well as higher sales-related selling and warehousing costs” and “continued operational inefficiencies due to Covid-19, particularly in the supply chain”, the company was able to reduce its operating expense ratio. The operating result (EBIT) grew by 27.0 percent to EUR 196.0 million compared to the same quarter of the previous year. Net profit attributable to shareholders increased by 11.2 percent to EUR 121.4 million.
The annual forecasts remain unchanged
For the year as a whole, the Executive Board continues to expect currency-adjusted sales growth of at least ten percent “with upside potential”, EBIT in the range of EUR 600 to 700 million and “a corresponding improvement in consolidated earnings”. However, the prerequisite is “that production in our most important procurement countries in Asia is maintained and that there are no major business interruptions due to Covid-19,” emphasized the company. In general, Puma expects earnings to be adversely affected due to the adverse framework conditions: It is to be expected that “inflationary pressure due to higher freight rates and raw material prices as well as operational inefficiencies due to Covid-19 and the Ukraine crisis will dilute our profitability in 2022,” explained the sports goods manufacturer.