Puma Q1 sales up by 6.1%

German multinational Puma posted 6.1% sales growth in the first quarter. The brand’s

profitability was affected by a slowdown in Europe. The company on April 25 reported its consolidated sales increased by 6.1% to € 820.9 million. But the gross profit margin fell by 120 basis points to 51.2%. Its earnings before interest, taxes (EBIT) declined by 8.1% to € 102 million. Net earnings decreased slightly, by 4.9%, to € 74 million. Earnings Per Share (EPS) declined from € 5.17 to € 4.92. Its long-term contractual partnership with the Italian Football Federation has been extended.

Puma’s first-quarter sales increased by 6.1% in euro terms and 4.2% currency adjusted to € 820.9 million compared to last year. But its sales in the Europe, Middle East and Africa (EMEA) region softened by 1.4% currency adjusted to € 368 million, as restrained consumer spending in the wake of the financial crisis in the Eurozone continued to impact demand. In addition to the challenging overall business climate, the late arrival of winter in Europe dampened sales at wholesale accounts and retailers, which slowed the in-take of spring collections and therefore had an effect on Puma’s first-quarter sales.

A strong sales performance in Asia/Pacific and the Americas counterbalanced the softening sales in the EMEA region. Fuelled by growth in India, Korea and Japan, all of which saw significant demand for Puma’s motorsport, running and lifestyle products, Asian sales climbed 10.2% currency adjusted to € 192.1 million. Sales in the Americas improved by 8.5% currency adjusted to € 260.8 million. Within the Latin American region, Mexico, Argentina and Brazil in particular posted strong, double-digit growth rates. North America was up, supported by the new joint ventures Wheat Accessories and Janed socks and bodywear.

Sales in the apparel segment climbed 8% currency adjusted to € 267.6 million in the first quarter. Accessories jumped 19% currency adjusted to € 138.7 million, where Cobra Puma Golf continues to deliver an outstanding performance, while the new joint venture for socks and bodywear in the North American market follows suit.

The brand’s gross profit margin softened to 51.2% in the first quarter of 2012. Input price pressures were mainly responsible for the drop of the gross profit margin in the first quarter, which comprised 51.2% of group sales, down from 52.4% at the same point last year. Apparel dropped slightly from 53.7% to 53.5% and accessories declined from 54.0% to 51.9% which is mainly due to the first-time inclusion of the newly added US sock and bodywear business, which carries lower margins.

The Puma Group owns the brands Puma, Cobra Golf and Tretorn. The company distributes its products in more than 120 countries. It has headquarters in Herzogenaurach/Germany, Boston, London and Hong Kong.