Puma: FY17 sales and earnings jump

Puma’s fourth quarter sales grew by 14.5 percent currency-adjusted and 8.6 percent reported to 1,040.2 million euros (1,276 million dollars) supported by double-digit growth across regions. In the financial year 2017, Puma’s sales increased by 15.9 percent currency adjusted and 14 percent reported to 4,135.9 million euros (5,073.3 million dollars), surpassing the 4 billion euro sales mark for the first time in the company’s history. Net earnings for the year reached 135.8 million euros (166.5 million dollars) against 62.4 million euros (76.5 million dollars) in 2016 translating into earnings per share of 9.09 euros (11.1 dollars) compared to 4.17 euros (5.11 dollars) last year.

Commenting on the full year results, Bjørn Gulden, Chief Executive Officer of Puma SE said in a statement: “2017 was a great year for us at Puma. We expect to increase our sales around 10 percent in constant currencies in 2018 and we expect to increase our EBIT to between 305 million to 325 million euros. We are also pleased by Kering’s proposal to reduce their ownership in Puma by a distribution of dividend in kind to its shareholders. PUMA will then be a public independent company with a much higher free float (55 percent) and with two strong anchor shareholders – Kering (16 percent) and Artemis (29 percent).”

Sales development across geographies in FY17

Growth in 2017 was particularly strong in the EMEA region, where sales rose by 19.5 percent currency adjusted and 19.1 percent reported to 1,646.2 million euros (2,019.3 million dollars). The company said, France, the DACH region (Germany, Austria and Switzerland) and the United Kingdom as well as Russia and South Africa delivered double-digit sales growth. Sales in the Americas region went up by 14.3 percent currency adjusted and 11.6 percent reported to 1,494.8 million euros (1,833.5 million dollars), with both North and Latin America contributing with double-digit growth rates.

In the Asia/Pacific (APAC) region, sales rose by 12.7 percent currency adjusted and 10 percent reported to 994.9 million euros (1,220.3 million dollars) driven by double-digit growth in China and Australia.

Footwear sales were up 23.5 percent currency adjusted and 21.4 percent reported to 1,974.5 million euros (2,421.6 million dollars). Running and Training as well as Sportstyle were the categories with the strongest growth rates. In the apparel segment, sales rose by 10 percent currency adjusted and 8.1 percent reported to 1,441.4 million euros (1,767.8 million dollars). The Sportstyle category, and especially women’s products, contributed to this increase. Sales in accessories grew by 9.2 percent currency adjusted or 8 percent reported to 719.9 million euros (882.9 million dollars) driven by socks, underwear, headwear as well as bags and backpacks, while Puma’s golf hardware business remained stable. Including ecommerce, Puma's own and operated retail sales rose by 22.9 percent currency adjusted to 961 million euros (1,178.8 million dollars).

Fourth quarter gross profit margin grew by 250 basis points from 44.6 percent to 47.1 percent. The operating result (EBIT) reached 14.1 million euros (17.3 million dollars) to 29.8 million euros (36.5 million dollars) in the fourth quarter 2017. Net earnings in the quarter improved to 2.2 million euros (2.7 million dollars) and earnings per share increased correspondingly to 0.14 euro (0.17 dollar). The gross profit margin improved by 160 basis points from 45.7 percent to 47.3 percent in 2017, while the operating result (EBIT) improved by 91.7 percent to 244.6 million euros (300 million dollars) in 2017.

Puma reveals outlook for 2018

For the full year 2018, we expect that currency-adjusted net sales will increase by approximately 10 percent. The gross profit margin is forecasted to improve slightly over 47.3 percent in 2017. At the current exchange rate levels, Puma’s management expects that EBIT will improve significantly due to higher sales and a slightly improved gross profit margin. The EBIT is therefore expected to come in between 305 million euros (374 million dollars) and 325 million euros (398.7 million dollars).

Based on Puma’s positive business development with a significant improvement of profitability and cash flow, the managing directors and the administrative board, the company added, will propose a one-off total dividend of 12.50 euros (15.3 dollars) per share for the financial year 2017 at the annual general meeting. In the previous year, Puma paid 0.75 euro (0.92 dollar) per share as a regular dividend.

Picture:Puma website