Puma lowers its profit guidance for 2013

Puma has cut its revenue and earnings forecast for the full year after reporting sales worse than expected in Europe and Asia. However, Puma still expects to continue to increase net profit compared to 2012. "In view of our first-quarter results and

of continuing economic uncertainty in certain key markets, management now expects a low- to mid-single-digit decline in full-year sales," Puma said in a statement.

For the first quarter, net profit fell 32 percent to a worse than expected 50 million and sales eased 2.3 percent to 782 million. Analysts in a Reuters poll had expected on average profit of 67 million euros and sales of 787 million euros.

In the same vein, the German sportswear and lifestyle giant said Tuesday it is revising downwards its full-year targets after business was hit by the "challenging" environment in the first three months of this year.

"This forecast represents a slight downward revision compared to the guidance provided with the 2012 full-year results."

In terms of profit, Puma said it was "also unlikely to meet its original guidance of low- to mid-single-digit growth" in underlying or operating profit.

"It was a rough quarter," said Chief Financial Officer Michael Laemmermann, who is acting CEO after the departure of Franz Koch in late March.

A “rough quarter”

The group is undergoing its biggest reorganisation in 20 years after suffering a 70 percent drop in net profit last year.

For the first quarter of this year it posted a 2.3 percent decline in group sales, while it saw shrinking profit margins and a bigger than expected 23 percent fall in operating profit.

The PPR owned group now forecasts sales to come in between 1 and 5 percent lower this year, well below last year's 3.27 billion euros.

Nor Puma will meet its target to increase operating profit (EBIT) before special items “by a low- to mid- single digit amount.” It is to be recalled that EBIT fell to a lower than expected 79 million euros during the three first months of the year, compared with the consensus market estimate of 93 million.

“The gap with Adidas and Nike Inc. (NKE) continues to widen,” summed up Jurgen Kolb, an analyst at Kepler Cheuvreux, commenting the news for Bloomberg.