2017 Second Quarter Facts
- Sales increase by 16% currency adjusted to € 969 million (+17% reported), with all regions showing double-digit growth and footwear being the main growth driver
- Gross profit margin up by 90 basis points to 46.5%
- OPEX increases by 11% caused by higher sales-related variable costs as well as higher marketing and retail investments
- Operating result (EBIT) improves to € 43 million (last year: € 12 million)
- Three major wins in football with Arsenal FC winning FA Cup, BVB Borussia Dortmund winning DFB cup and Chivas winning Mexican championship
- PUMA’s new lacing technology NETFIT introduced across performance and sportstyle footwear
2017 Half-Year Facts
- Sales up by 16% currency adjusted to € 1,974 million (+18% reported) with double-digit growth in all regions
- Gross profit margin up 60 basis points at 46.8%
- Operating leverage with OPEX increasing only by 12%
- Operating result (EBIT) more than doubled from € 53 million last year to € 114 million
- Net earnings increase from € 27 million last year to € 72 million and earnings per share increase from € 1.84 last year to € 4.79 respectively
- Continued strong women business driven by BASKET HEART and FIERCE footwear styles
- Successful introduction of “Run the Streets” with IGNITE Limitless and TSUGI footwear styles featuring R&B star and style icon The Weeknd
Bjørn Gulden, Chief Executive Officer of PUMA SE:
“In another positive quarter, we achieved double-digit growth in all regions and in both footwear and apparel. This combined with a good sell-through in retail and a good orderbook for the next quarters made us raise the outlook for the full year. We now expect a currency adjusted sales growth for the full year between 12% and 14% and a full-year EBIT between € 205 million and 215 million.”
Second Quarter 2017
PUMA's sales growth continued in the second quarter of 2017. Sales increased by 16.3% currency-adjusted to € 968.7 million (+17.2% reported), compared to € 826.5 million in the previous year. All regions contributed with double-digit increases. Footwear continued to be the main growth driver though Apparel also grew double-digit, while Accessories grew at a more modest rate.
The gross profit margin improved, despite negative currency effects, by 90 basis points from 45.6% in the second quarter last year to 46.5%.
Operating expenses (OPEX) rose by 11.4% to € 410.8 million in the second quarter. The increase of operating expenses in the quarter is mainly due to higher sales-related variable costs as well as further marketing and retail investments. Costs for other operating functions grew only moderately.
The operating result (EBIT) increased from € 11.9 million last year to € 43.4 million due to strong sales growth combined with an improved gross profit margin.
Net earnings increased from € 1.6 million to € 21.9 million and earnings per share were up correspondingly at € 1.46 compared to € 0.11 in the second quarter last year.
First Half-Year 2017
Sales for the first half-year 2017 improved by 15.8% currency adjusted to € 1,973.8 million (+17.6% reported) and were above expectations. All regions showed double-digit growth with Footwear being the main growth driver. Major gains were achieved by the Running and Training and Sportstyle categories, with Platform, Suede, BASKET HEART and IGNITE Limitless footwear styles performing well.
Including eCommerce, PUMA's own and operated retail sales increased by 21.8% currency adjusted to € 430.3 million. This represents a share of 21.8% of total sales for the first half of 2017 (20.5% in the previous year). The performance was achieved by positive like-for-like growth in our existing retail stores, strong growth in our eCommerce business and opening of new additional stores.
The gross profit margin improved, despite negative currency effects, by 60 basis points from 46.2% to 46.8% in the first half-year 2017. The increase was mainly due to further improvements in sourcing and selective price adjustments.
Operating expenses (OPEX) increased by 11.9% and amounted to € 817.6 million. The increase was driven by higher sales-related variable costs, intensified marketing activities and investments in own retail stores. Costs for other operating functions grew only moderately.
The operating result (EBIT) more than doubled from € 53.2 million last year to € 113.6 million in the first half of 2017 underlining the improved operating performance, with strong sales growth, a higher gross profit margin and an improved operating leverage.
Net earnings improved significantly in the first half-year and came in at € 71.5 million (last year: € 27.4 million). This result translates into earnings per share of € 4.79 compared to € 1.84 last year.
Despite the double-digit sales growth and a higher number of owned and operated retail stores, PUMA’s working capital increased only moderately by 6.4% to € 700.1 million. Inventories were up 10.8% at € 850.6 million in order to ensure product availability and to support further growth as well as to meet the increased need for products due to our additional retail stores. Trade receivables rose by only 9.0% to € 561.8 million despite the strong sales growth. Trade payables were up 12.6% to € 645.1 million.
As a result of the working capital development and higher capital expenditures the free cash flow came in at € -117.9 million compared to € -107.3 million in the first half of 2016, while the net cash position improved from € 129.9 million as of June 30 to € 152.4 million.
In light of the strong second-quarter increase in sales and profitability as well as the positive business outlook for the current year 2017, PUMA raises the full-year guidance for its consolidated sales and operating result (EBIT). The Management now expects that currency adjusted sales will increase between 12% and 14% (previous guidance: currency adjusted increase at a low double-digit percentage rate). The operating result (EBIT) is now anticipated to come in between € 205 million and € 215 million (previous guidance: between € 185 million and € 200 million). In line with the previous guidance, the Management still expects that net earnings will improve significantly in 2017.
Financial Calendar FY 2017:
February 9, 2017 Financial Results FY 2016
April 12, 2017 Annual General Meeting
April 25, 2017 Quarterly Statement Q1 2017
July 26, 2017 Interim Report Q2 2017
October 24, 2017 Quarterly Statement Q3 2017
The financial releases and other financial information are available on the Internet at „about.puma.com“.
Notes to the editors:
· The financial reports are posted on www.about.puma.com.
· PUMA SE stock symbol:
Reuters: PUMG.DE, Bloomberg: PUM GY,
Börse Frankfurt: ISIN: DE0006969603– WKN: 696960
Notes relating to forward-looking statements:
This document contains forward-looking statements about the Company’s future financial status and strategic initiatives. The forward-looking statements are based on the current expectations and assumptions of the management team. These are subject to a certain level of risk and uncertainty including, but not limited to those described above or in other disclosures, in particular in the chapter Risk and Opportunity Management in the Group Management Report. In the event that the expectations and the assumptions do not materialize or unforeseen risks arise, the Company's actual results can differ significantly from expectations. Therefore, we cannot assume responsibility for the correctness of these statements.