Puma reports Q1 FY20 sales of €1,299 million

07 May '20

3 min read

Pic: Puma

Puma, a German manufacturer of athletic footwear and apparel, posted 1.3 per cent sales decrease to €1,299.8 million in first quarter (Q1) FY20 ended on March 31, 2020 compared to sales of €1,319.3 million in same period prior year. Net earnings for the quarter fell 61.7 per cent to €36.2 million. Gross profit were 4.4 per cent down to €618.5 million.

“2020 started very well with a great order book, strong sell through and record retail numbers. Then, at the end of January, the Covid-19 virus hit China. Since then we have worked to minimise the damage short-term without hindering the mid-term momentum of Puma. We are looking at three phases: Survive, Recover, Grow Again,” Bjørn Gulden, chief executive officer of Puma, said in a press release.

The company reported that China, Japan and Korea were the most severely impacted countries and led to a decline of first quarter sales in the Asia/Pacific region of 12.0 per cent. The EMEA (Europe, the Middle East and Africa) and Americas regions, have been negatively impacted since March 2020, still showed a slightly positive sales development in the first quarter, increasing by 3.5 per cent and 3.1 per cent respectively.

In terms of product divisions, Footwear grew by 1.9 per cent. Apparel sales declined 6.3 per cent and Accessories sales were 0.2 per cent down.

Both wholesale and retail channels were reportedly impacted by the store closures around the globe. At the end of the first quarter, almost all of Puma owned and operated retail stores as well as its retail partners were closed. Puma’s sales in e-commerce grew around 40 per cent during the quarter.

"The first quarter was difficult, but we feel we did a decent job. The second quarter will financially be even worse with more than 50 per cent of global sports and sport lifestyle space being closed. We are mitigating the impact on our revenues wherever we can by focusing on e-commerce and the markets that are opening up again,” Gulden said.

We are working with our factories and other partners in our supply chain to minimise the damage, assure timely deliveries, avoid excess stock as much as possible and to find fair solutions for all of us.”

Puma in its outlook reported that it is witnessing improvement in APAC (Asia Pacific), especially China and South Korea are recovering; and Puma saw the first store openings again in some of the European countries. The distribution in Americas is still almost fully shut down. E-commerce is growing at a very high rate, but this growth cannot in any way compensate for the revenue loss in the other channels, as reported.

Fibre2Fashion News Desk (JL)

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