“While the market continues to experience significant macroeconomic headwinds and 2023 remains a transition year, we outgrew the market with a currency adjusted sales growth of 6% and delivered an EBIT of € 236 million – both fully in line with expectations. We once again demonstrated our sustained brand momentum and gained market share. We remain fully on track to achieve our full-year guidance”, commented Arne Freundt, Chief Executive Officer of Puma.

Third Quarter Results

In the third quarter of fiscal 2023, the company’s sales grew by 6.0% on a currency adjusted (ca) basis, reaching 2.31 billion euros, but decreased by 1.8% in euros terms, on a comparable basis to the same period of last year. Its wholesale business contributed 1.78 billion euros to the total revenue, up by 3.1% (ca) year-over-year, while the DTC business added 524.9 million euros, up by 17.4% year-over-year.

Puma’s sales totalled 1.02 billion euros in the EMEA region in the third quarter of the current fiscal year, up by 9.9% (ca) from a similar period a year ago. Meanwhile, in the Asia Pacific region, the company’s sales rose by 4.6% (ca) to 435.0 million euros, year-over-year, “supported by a continued trend of recovery in Greater China following the market reopening, as well as ongoing growth in Japan and India”. In the Americas region, sales amounted to 854.6 million euros, increasing only by 2.5% (ca) year-over-year, mainly due to macroeconomic headwinds in North America.

In the third quarter of the current fiscal year, the sportswear company’s gross profit margin widened by 30 basis points to 47.1% from the same period of the previous year, as the currency effects that further intensified compared to last quarter, were “more than offset by tailwinds from sourcing, freight, price adjustments, geographical and distribution channel mix effects”, it added.

Despite the positive impact of the improved gross margin, Puma’s third quarter EBIT was 236.3 million euros, decreasing by 8.3% due to currency effects, on a comparable basis to the same period of the prior year; EBIT margin came in at 10.2%. Therefore, in the three months to the 30^th of September, the company’s net income totalled 131.7 million euros, down by 10.0% from the same period a year ago.

Outlook

“While remaining fully focused on its controllables, Puma continues to operate in an increasingly challenging geopolitical and macroeconomic environment. The recent conflict in the Middle East, the war in Ukraine, persistent inflation and the risk of recession are weighing on consumer sentiment, resulting in volatile demand in the retail sector”.

Nevertheless, the company is still expecting a currency adjusted sales growth in the high-single-digit percentage range for fiscal 2023, as well as an “unchanged operating result (EBIT) in the range of 590 million euros to 670 million euros” and a respective change in net income. In addition, it anticipates an improvement in profitability in the fourth quarter, “mainly driven by a significant gross margin improvement due to lower sourcing and freight costs as well as fewer promotional activities”.