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The company's operating expenses grew by 7.5 per cent to € 437.3 million in the first quarter of 2018 due to higher marketing and retail investments as well as higher sales-related variable costs. Net earnings went up by 35.8 per cent to € 67.4 million (last year: € 49.6 million). This translates into earnings per share of €4.51 compared to € 3.32 in the first quarter of 2017.
EBIT increased by 59.9 per cent from € 70.2 million to € 112.2 million in the first quarter of 2018 due to a strong sales growth, a higher gross profit margin and an improved operating leverage. This corresponds to an EBIT-margin of 9.9 per cent compared to 7.0 per cent in the first quarter of last year.
Strong currency effects and continued focus on working capital management led to a decrease of working capital of 1.3 per cent to €791.0 million. Omitting these currency impacts, working capital would have grown by around 10 per cent, lower than our growth in business. Inventories rose only slightly by 1.3 per cent to € 760.4 million and trade receivables grew by only 5.8 per cent to € 685.0 million. Trade payables decreased by 8.0 per cent to € 471.4 million.
"We started the year with both first-quarter sales and profitability (EBIT) coming in stronger than we had expected. The double-digit sales growth in all regions and product segments, including an exceptionally high growth in Asia, led to a very strong 21.5 per cent organic sales increase. Operating result even grew by 60 per cent to € 112 million due to higher sales, an improvement in our gross margin and a tight OPEX management," said Bjørn Gulden, chief executive officer of Puma.
The first quarter saw a strong increase in sales and profitability, but several uncertainties in the business environment have recently developed. This includes adverse and volatile currency developments, political instabilities as well as the uncertain trade environment between the US and China. Hence, Puma now expects that currency-adjusted sales will increase between 10 and 12 per cent. EBIT is now anticipated to come in between € 310 million and € 330 million. The net earnings are expected to improve significantly in 2018.
"Because of an uncertain business environment caused by volatile currency rates and the difficult economic trade environment, we raised our outlook for the full year only slightly," concluded Gulden. (RR)
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