German sportswear company Puma has reported a 5% increase in currency-adjusted sales for the third quarter (Q3) of 2024, reaching €2.308bn ($2.5bn), with growth across the Americas, Asia/Pacific and Europe, and the Middle East and Africa.
Currency headwinds impacted sales by approximately €100m, slightly reducing the reported growth rate by 0.1%.
The Americas led the growth with an 11.4% increase to €872.2m, bolstered by the US and Latin America.
Net income, however, fell by 3% to €127.8m, with earnings per share at €0.86, mainly due to a stronger socks and bodywear business in the US affecting non-controlling interests.
The operating result (EBIT - earnings before interest and taxation) saw a marginal increase of 0.3% to €237m, mainly due to the improved gross profit margin, with the EBIT margin at 10.3%.
The gross profit margin improved by 80 basis points to 47.9%, attributed to a favourable product mix and lower freight and sourcing prices, despite currency challenges and increased promotional activities in some regions.
Direct-to-consumer (DTC) business saw a growth of 17%, reflecting sustained brand strength. Sales from owned and operated retail stores rose by 12.8%, while e-commerce sales grew by 26.4%.
Operating expenses (OPEX) rose by 1.1% to €873.4m, driven by the expansion of DTC business, warehouse costs and digital projects, but were partially offset by lower marketing payments and a shift in marketing investments to the fourth quarter.
During Q3, PUMA's share buyback programme resulted in the repurchase of 422,855 shares for €18.5m. Working capital increased by 4.9% to €1.88bn, with inventories down by 3.3% but trade receivables and payables both rising.
PUMA SE CEO Arne Freundt said: “I'm pleased with the progress on our brand elevation journey as we are building the foundation for accelerated and sustainable growth. We know this takes time, but we have made strong strides in enhancing our brand equity and desirability, stepping up our performance business, and building up consumer relevance in the Sportstyle Prime market.
“Our new Speedcat Go-to-Market strategy is performing very well and I am excited about the commercial launch of the Speedcat in a few weeks. I am also pleased that our wholesale business has returned to growth.”
For the first nine months of 2024, sales increased by 2.6% to €6.53bn, with currency headwinds leading to a reported decline of 1.4%.
OPEX increased by 1.7% to €2.59bn, with the OPEX ratio rising 120 basis points to 39.8%. EBIT decreased by 2.7% to €513.2m, with an EBIT margin of 7.9%.
ross profit margin for the nine months rose by 130 basis points to 47.4%, overcoming currency and promotional headwinds.
The financial result worsened to €-116.2m, and net income dropped by 15.4% to €257.1m in the nine months.
Despite a volatile environment, the company reiterates its 2024 outlook of mid-single-digit currency-adjusted sales growth and EBIT between €620m and €670m, expecting net income to align with EBIT.
Freundt added: “With accelerated sales growth in Q3 and EBIT meeting expectations as well as a strong order book for Q4, we're on track to meet our full-year 2024 outlook. This success is due to the great engagement of the entire PUMA family and its incredible partners.”
