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Puma confirms full-year outlook, flags market volatility
Global Banking & Finance Review®
Company
By Alexander Hübner and Joice Alves
BERLIN/LONDON (Reuters) – Shares in Puma fell 1.75% on Wednesday after the company confirmed its full-year guidance but flagged uncertainty in the global market.
The German sportswear maker reiterated its full-year operating result and sales outlook, after what it said was the best third quarter in its history.
“We expect continued volatility in the market during the fourth quarter but are confident that we can deliver according to our full-year outlook,” said Puma Chief Executive Bjorn.
The company said its earnings before interest and taxes (EBIT) rose by 12.6% on the year to 258 million euros ($257 million) while third-quarter sales rose a currency-adjusted 16.9% to 2.35 billion euros ($2.34 billion).
“Improved product availability due to a more stable supply chain, better than expected sell-through and Puma’s continued global brand momentum overcompensated all the negative external factors,” Gulden said.
Despite continued effects of COVID-19-related lockdown measures in China, Puma saw sales growth in the Asia/Pacific region in the third quarter, it said.
The company expects currency-adjusted sales growth of around 15% and an EBIT between 600 and 700 million euros for 2022.
Jefferies equity analysts said Puma’s results have proven resilient “in a worsening industry contest” after recent profit warnings from competitors Nike and Adidas highlighting excess inventories across the industry.
Last week, German sporting goods maker Adidas cut its full-year guidance, citing weaker expectations for China, lower demand in major Western markets and one-off expenses related to its exit from the Russian market.
($1 = 1.0029 euros)
(Reporting by Alexander Huebner and Joice Alves, Writing by Miranda Murray, editing by Paul Carrel and Bernadette Baum)
Market volatility refers to the rate at which the price of securities increases or decreases for a given set of returns. It is often associated with the level of risk in the market.
EBIT stands for Earnings Before Interest and Taxes. It is a measure of a firm's profit that includes all incomes and expenses except interest and income tax expenses.
Sales growth is the increase in sales over a specific period, typically expressed as a percentage. It indicates how well a company is performing in generating revenue.
Operating result refers to the profit a company makes from its core business operations, excluding any income derived from non-operating activities.
Currency-adjusted sales growth measures the increase in sales while accounting for fluctuations in currency exchange rates, providing a clearer picture of a company's performance in different markets.
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