“Through the acquisition of Cobra Golf, we reinforce PUMA’s commitment to our sports performance business by strengthening our growing and successful Golf category,” said Jochen Zeitz, Chairman and Chief Executive of PUMA. “Cobra Golf has a history of innovative performance products fused with an edge and is therefore a perfect fit for PUMA, reinforcing our overall mission of becoming the most desirable Sportlifestyle company. With Cobra Golf, PUMA will capitalize on the many opportunities in the Golf category and upside potential ahead of us.”

Based in Carlsbad, California, Cobra Golf was founded in 1973 and produced one of the first utility clubs, the Baffler, long before use of such clubs became popular, manifesting Cobra Golf’s hybrid leadership. This leadership and innovation continues today with recent releases such as the new ZL and S2 Drivers, as well as the Baffler Rail Hybrid. In 1996, Cobra Golf was acquired by American Brands Inc. (later renamed Fortune Brands) and has since then been managed together under the Acushnet Company umbrella with its other golf brands.

With this acquisition the combination of Cobra and PUMA Golf provides a competitive full range offering to become a better resource to its account base, being now in the position to provide Golf equipment next to footwear, apparel and accessories.

Pending regulatory approval, the effective date of the acquisition of Cobra Golf is expected to be in the second quarter of 2010. Financial terms of the transaction will not be disclosed.

Further information will be provided with the release of the first quarter results 2010.

“We are proud of PUMA Ocean Racing’s success in the last Volvo Ocean Race and look forward to the adventures this next race will bring,” said Jochen Zeitz, PUMA AG Chairman and CEO. “Both the team and the company hope to leverage the key lessons from the last VOR campaign in order to continue spreading the good will of the program and PUMA worldwide. The Volvo Ocean Race is one of the world’s iconic sporting events. It proved to be an extremely successful marketing tool for us and an important launch pad for the sailing product category. We look forward to building the sailing category even more throughout the next race, as well as expanding into other forms of outdoor lifestyle ventures.”

For the 2011-2012 race, PUMA Ocean Racing has proudly partnered with BERG Propulsion, one of the world’s leading designers and producers of Controllable Pitch Propellers for commercial shipping. BERG Propulsion products are designed and engineered with the reduction of adverse environmental impact in mind, striving to bring fuel savings and environmental benefits to every product. This commitment to sustainability and strive for high performance makes them a perfect partner for PUMA. The team will be known as PUMA Ocean Racing, powered by BERG Propulsion.

“This is a key addition to our campaign,” stated Antonio Bertone, Chief Marketing Officer, PUMA AG. “BERG CEO Hakan Svensson and his entire company are a perfect fit with our operation. As a life-long competitive sailor himself, Hakan understands the sport, the race and how BERG can utilize the race to help build and market their global company.”

Hakan Svensson, Berg Propulsion Chairman and CEO stated “Our company is very excited to be a part of the VOR this year and we are especially proud to have the opportunity to partner with PUMA. We view the race as a perfect symbol for what Berg Propulsion represents: global perspective and reach, an emphasis on quality, reliability and a desire for excellence achieved through a strong TEAM spirit. Very much like the shipping industry, the Volvo Ocean Race is about performance on a global arena and this is directly applicable to our customer’s situation, who are also out there 24/7 under very tough conditions. We will do our absolute best to support Ken Read and his talented crew in their efforts to be the fastest around the world.”

Team selection efforts are already underway and will likely include a number of sailors from PUMA’s 2008-2009 team, plus a mix of new and veteran talent from the professional racing world. Training will begin onboard PUMA’s il mostro in Spring 2010 at the team’s homebase in Newport, Rhode Island.

Skipper Ken Read, considered to be one of the world’s most accomplished racers, was in charge of PUMA Ocean Racing and at the helm of PUMA’s il mostro throughout the entire Volvo Ocean Race 2008-2009. The U.S.-born Read has twice helmed America’s Cup programs in 2000 and 2003 and was named “United States Rolex Yachtsman of the Year” twice and has 46 World, North American and National Championships to his credit.

“This last race was an amazing journey for me personally and for our start-up company PUMA Ocean Racing,” said Ken Read. “To have the opportunity to continue where we left off is a dream come true. For PUMA to want to come back to this adventure is a testament to the event itself and to the entire PUMA Ocean Racing team past and present. We look forward to the challenges that lie ahead both organizationally as well as competitively.”

PUMA is committed to working across the globe in sustainable, creative and innovative ways to lessen the impact on the environment and to give back what it takes from the planet by seeking to reduce its carbon footprint in all areas of business. The sportlifestyle brand’s entry into the Volvo Ocean Race is compatible with this mission, as sailing is considered a ‘clean sport’, using only the wind to harness the power needed to race across the world over the course of nine months.

The entry into competitive sailing extends PUMA’s focus into premium lifestyle sports – a category PUMA has forged through its Formula 1 partnerships and other Motorsports collaborations such as Ducati and Ferrari, and the launch of a sportlifestyle Golf collection in 2006.

PUMA has been collecting E-KPIs (Environmental Key Performance Indicators) from all its offices and stores worldwide for the last five years and identified several key areas that need to be dealt with in order to further reduce PUMA’s “paw print”. To address these issues, PUMA is launching its next phase of puma.safe initiatives in the company’s long-term sustainability program laying out ambitious targets to be achieved by 2015. The major objectives PUMA has set out to achieve in this period include:

• 25% reduction of CO2, energy, water and waste in PUMA offices, stores, warehouses and direct supplier factories.
• Paperless office policy through a 75% reduction and offsetting initiatives for the remaining paper usage such as tree planting initiatives.
• 25% CO2 reduction through more efficient product transport solutions by our logistic partners.
• Begin collaborating with our strategic suppliers and logistic service providers to offset their own footprints in the long-term.
• Introduction of the PUMA Sustainability-Index (S-Index) standard that serves as a benchmark for sustainable products and communicates the products’ sustainable features to consumers.
• 50% of PUMA’s international collections will be manufactured according to the PUMA S-Index standard by 2015, using sustainable materials such as organic cotton, Cotton Made in Africa or recycled polyester as well as applying best practice production processes.
  
  

To monitor these objectives PUMA is also establishing an external Advisory Board of experts in sustainability to consult on PUMA’s mission and audit PUMA’s sustainability program.

“For a long time our mission has been to become the most desirable Sportlifestyle company. With this next phase of our sustainability program we have evolved our mission to be the most desirable and sustainable Sportlifestyle company in the world,” said Jochen Zeitz, Chairman and CEO of PUMA. “Through PUMAVision and our puma.safe program we have already started to reduce our carbon emissions, curtail wasteful transportation, recycle and reuse available materials, use water sparingly and become paperless.”

Through PUMAVision, our vision of a better world, initiatives fall under the three pillars of puma.safe, puma.peace, and puma.creative to drive the company to cleaner, greener, safer and more sustainable systems and practices contributing to peace as well as promoting creativity and the arts. Under the puma.safe program, PUMA’s ultimate objective is to give back to the environment what it has taken. PUMA’s longstanding work and efforts to improve social, labour and environmental standards throughout its operations date back to 1999. From that time, the company has continuously incorporated environmentally-friendly practices to reduce its impact on the planet and realized several successful large-scale initiatives such as sourcing of raw materials through the Cotton made in Africa campaign to building the capacity of its suppliers as well as the opening of the industry’s first carbon neutral head office — the PUMAVision Headquarters in Herzogenaurach, Germany — last year after joining the UN Climate Neutral Network

The next milestone in PUMA’s mission to be the most desirable and sustainable Sportlifestyle company in the world is the introduction of an innovative packaging and distribution system for PUMA products that will reduce the paper used for shoeboxes by 65% and carbon emissions by 10k tons per year — the remaining packaging materials used will be fully sustainable by 2015. PUMA partnered with designer Yves Béhar, of San Francisco based fuseproject, to rethink the way the millions of pairs of shoes that it sells each year are packaged — less packaging means fewer raw materials, less use of water and energy to produce, and less weight to ship and to be disposed of. Béhar designed a “Clever Little Bag” to replace the cardboard shoebox with a re-usable shoe bag, that protects each pair of shoes from damage from the point it leaves the factory until the consumer takes it home — thus generating savings on the production side due to less material used, reducing weight during transport and eliminating the need for extra plastic carrier bags. As a result of the 65% paper reduction through the “Clever Little Bag” concept PUMA will reduce water, energy and diesel consumption on the manufacturing level by more than 60% per year. In other words: approximately 8,500 tons less paper will be consumed, 20 million Megajoules of electricity saved, 1 million litres less of fuel oil used and 1 million litres of water saved. During transport 500,000 litres of diesel is saved and lastly, due to the replacement of traditional shopping bags with the lighter built-in bag the difference in weight can save up to 275 tons of plastic.

“I was excited to partner with PUMA and contribute to such a game changing project,” said Yves Béhar. “PUMA’s initiative to look closely at one of the most challenging issues facing the retail industry in regards to sustainability and environmental harm was inspirational. In changing the packaging and distribution life cycle from the ground up, we hope our new design and comprehensive solution encourages other retail companies to follow suit.”

PUMA’s apparel collections will be bagged using sustainable material, replacing traditional polyethylene bags. This means that 720 tons of polyethylene bags can be avoided per year, which equals a saving of 29 million plastic bags — enough to cover an area the size of 1000 football pitches. Furthermore, PUMA T-shirts will be folded one more time to reduce the packaging size and thus saving CO2 emissions and costs during transport.

By switching out current plastic and paper shopping bags in PUMA stores and replacing them with sustainable biodegradable bags the sportlifestyle company is looking to save another 192 tons of plastic and 293 tons of paper annually.

The roll out of the new packaging and distribution system is planned as of the second half of 2011.

PUMA’s long-term sustainability program, however, will not stop with the accomplishment of the ambitions outlined above. The company takes responsibility to further reduce harm, working towards closed-loop systems and recycling programs. PUMA will continue to find innovative solutions that no longer deplete resources and will offset its “paw print” where further mitigation is not possible.

PUMA will make its next significant announcement on sustainability in the framework of the United Nations conference “The Business for the Environment Summit (B4E) in Seoul on 22 – 23 April, 2010.

“To be the first carbon neutral Sportlifestyle company is the next logical step in our mission to become the most desirable and sustainable Sportlifestyle company in the world,” said Jochen Zeitz, Chairman and CEO of PUMA. “We also took UNEP’s challenge to offset our football teams’ international travels to South Africa very seriously. Our commitment to the environment partnered with our long-standing collaboration with African football made it a foregone conclusion to support their initiative, and we hope in doing so that we inspire other stakeholders in the FIFA World Cup 2010 to follow suit.“

PUMA will compensate the company’s direct and indirect CO2 emissions through offsetting projects in Africa that also take the needs of local communities and the conservation of biodiversity and CSR programs into account. The portfolio of offsetting projects in Africa is being verified by an internationally recognized auditing company according to internationally accepted standards such as the Clean Development Mechanism (CDM), the Gold Standard and Voluntary Emission Reduction standards. PUMA’s total carbon footprint is externally verified utilizing similar methodology applied to the company’s carbon neutral headquarters.

Due to PUMA’s target of its long-term sustainability program to reduce its energy and water consumption, waste and CO2 emissions by 25% by 2015; the amount of CO2 emissions to be offset will decline on an annual basis. However, more than only saving energy, PUMA will require its local offices, stores and warehouses to switch to electricity from renewable sources wherever feasible – in line with its PUMAVision Headquarters in Germany. Thus significantly reducing the building’s carbon footprint. To offset the headquarter’s remaining CO2 emissions, PUMA actively supports a wind farm in Turkey as an offsetting project. Through this, PUMAVision Headquarters became the first carbon neutral company head office in the sportlifestyle and sporting goods industry.

PUMA has started to deeply embed its long-term sustainability program into the company’s operations and product cycle, making it an integral part of PUMA’s DNA. With football being a core business of the sportlifestyle company, it is only natural that PUMA responded to the United Nations Environment Programme’s (UNEP) petition that all Football Federations participating in the FIFA World Cup 2010 in South Africa offset their teams’ international travels. Therefore, PUMA will offset the carbon footprint of its football teams – a total of 336 players and officials. The PUMA teams that qualified for the World Cup include: Algeria, Cameroon, Ivory Coast, Ghana, Italy, Switzerland, and Uruguay. To further illustrate the importance of UNEP’s ‘call to action’, PUMA has decided to go one step beyond and offset all local travel and accommodation as well.

PUMA has been collecting E-KPIs (Environmental Key Performance Indicators) from all its offices, warehouses and stores worldwide for the last five years to determine the company’s total carbon footprint on an annual basis. PUMA’s global emissions are classified in accordance to the Greenhouse Gas Protocol including direct emissions generated through gas, fuel and car fleets as well as indirect emissions generated through electricity and steam from offices, shops and warehouses and further indirect emissions deriving from business travels. PUMA’s carbon offsetting does not include CO2 emissions through transportation of PUMA products. However, PUMA requested its business partners to initiate reduction of their own CO2 footprint.

Furthermore, PUMA will support the offsetting of its employees’ carbon footprints by subsidizing those emissions generated on the way to and from work by 50%. PUMA CEO Jochen Zeitz will also offset his personal carbon footprint, including direct and indirect CO2 emissions, on his own account.

Further information on PUMA’s sustainability program and current initiatives can be found in PUMA’s sustainability report. http://ir2.flife.de/data/puma_csr/igb_html/index.php?bericht_id=1000001

Notes to Editors:

Many carbon emissions [outlined above] are not part of the Kyoto Protocol and hence PUMA’s actions are entirely voluntary. PUMA’s carbon offsetting does not include carbon emissions through transport and manufacturing of PUMA products.

Highlights January-March:

• Consolidated sales down by 2.1%
• Gross profit margin at a strong, sector-leading 52.2%, slightly above last year’s level
• Strong improvements in cost structure as a result of the cost reduction program
• Operating result jumps € 115 million versus last year
• EPS increase to € 5.51 after € 0.37
• Further improvement in equity ratio to 64%

Outlook 2010:

• Management expects sales growth in the low to mid single-digits
• Cost reduction program shall provide cost savings as planned
• Pre-tax profit is expected to improve by at least 70%

Jochen Zeitz, CEO: “We had a good start into the new year from a bottom line perspective which highlights the effectiveness of our comprehensive restructuring and reengineering efforts. Assuming a continuous improvement of the economic outlook and a planned increase of supplier orders, we anticipate low to mid single digit growth for the full year, while net earnings should jump significantly to complete the expected earnings rebound. We are now looking forward to the upcoming World Cup and to a successful integration of our newly acquired Cobra Golf business.”

Sales and Earnings Development January-March 2010

Global Brand Sales

Worldwide PUMA brand sales, which include consolidated and license sales, decreased by 2.3% to € 720.6 million.
Footwear sales were down by 6.0% to € 382.8 million and Accessories by 3.1% to € 90.3 million. Apparel sales increased by 4.3% to € 247.5 million.

Consolidated Sales

PUMA’s consolidated sales in the first quarter were down by 2.7% currency-neutral and 2.1% in Euro terms to € 683.1 million. This development should be seen in the context of last year’s sales increase of 3.6%, which was mainly driven by closeout sales in order to reduce inventories. In addition, supplier orders for the first half of 2010 were placed with caution. Excluding the previous year’s inventory clearance, sales were slightly above last year. Sales in Footwear declined currency-neutral by 5.1% to € 378.8 million and Accessories decreased by 1.6% to € 77.5 million. Apparel sales rose by 1.2% to € 226.8 million due to a positive development in PUMA’s teamsport business. In regional terms, sales in EMEA were down currency-neutral by 6.2% to € 351.8 million (share: 51.5%) and Asia/Pacific declined by 8.4% to € 141.0 million (share: 20.6%). Sales in the Americas region significantly improved by 9.8% to € 190.4 million (share: 27.9%) with both regions – North America and Latin America – positively contributing to this strong performance.

Gross Profit Margin

In the first quarter, PUMA’s gross profit margin reached a strong, sector-leading 52.2% compared to 52.1% last year. The Footwear segment reported 50.7% versus 50.4%, Apparel was at 53.5% compared to 53.7% and Accessories remained unchanged to last year at 55.6%. In terms of region, the gross profit margin in EMEA softened to 54.3% after 55.1%, Americas rose to 47.4% from 46.7% – driven by Latin America – and Asia/Pacific improved to 53.4% from 51.0% last year.

Operating Expenses

Operating expenses decreased by 4.6% from € 254.1 million to € 242.3 million. As a percentage of sales, the cost ratio improved from 36.4% last year to 35.5% because of the cost reduction program introduced last year. Expenses in marketing/retail and depreciation decreased due to the improvement to the overall retail store portfolio.

EBIT

PUMA’s EBIT before special items increased by 4.4% to € 119.0 million versus € 114.0 million last year. As a percentage of sales the EBIT margin improved from 16.3% last year to an excellent 17.4%. Taking last year’s special items into account, EBIT increased from € 4.0 million to € 119.0 million.

Financial Result

The financial result was at € -1.2 million after € -1.6 million last year, as the net cash position improved significantly and led to lower interest expenses due to reduced bank debts.

Net Earnings 

The pre-tax profit (EBT) jumped from € 2.4 million to € 117.8 million. Net earnings increased to € 83.1 million from € 5.6 million based on a tax rate of 29.5% versus an operational tax rate of 28.5% last year.
Earnings per share rose to € 5.51 from € 0.37 and diluted earnings per share were at € 5.50 compared to
€ 0.37 last year.

Net Assets and Financial Position

Equity

As of March 31, 2010, total assets increased by 2.4% to € 2,159.3 million while PUMA’s equity ratio improved significantly from 56.6% to 64.0% this year.

Working Capital

Inventories declined by 15.9% to € 375.7 million and accounts receivable went up by 6.7% to € 568.6 million. Accounts payables increased by 7.2% to € 265.5 million. Working capital remained stable at € 595.6 million compared to € 596.9 million last year.

Capex/Cashflow

Capital investment amounted to € 7.7 million in the first quarter after € 11.6 million in the previous year.
The free cashflow came in at € -73.4 million compared to € -118.0 million last year.

Cash Position

Total cash by the end of March jumped 59.5% to € 426.8 million after € 267.6 million last year. Bank debts were reduced by 41.8% from € 63.2 million to € 36.8 million. As a result, the net cash position improved significantly by 90.7% from € 204.5 million to € 390.0 million.

Outlook 2010

Assuming a further improvement in the overall economic outlook, sales for the full year 2010 should strengthen accordingly throughout the year. The company’s pre-tax profit is expected to improve by at least 70% in 2010 while sales should post an increase in the low to mid single digits.

This document contains forward-looking information about the Company’s financial status and strategic initiatives. Such information is subject to a certain level of risk and uncertainty that could cause the Company’s actual results to differ significantly from the information discussed in this document. The forward-looking information is based on the current expectations and prognosis of the management team. Therefore, this document is further subject to the risk that such expectations or prognosis, or the premise of such underlying expectations or prognosis, become erroneous. Circumstances that could alter the Company’s actual results and procure such results to differ significantly from those contained in forward-looking statements made by or on behalf of the Company include, but are not limited to those discussed be above.

Twenty strategic PUMA suppliers based in China, Vietnam, Cambodia and other countries – which produce together more than two thirds of all PUMA products consumed – will receive GRI certified training on transparent measurement and reporting on their sustainability performance using the GRI G3 Guidelines – the world’s most widely-used framework for sustainability reporting. The training within the Global Action Network for Transparency in the Supply Chain program (GANTSCh) will be conducted by GRI Certified Training Partners. During the reporting process, scheduled to start in 2010, the suppliers will be supported by regional sustainability consultants and the first sustainability reports are expected to be released in 2011/2012.

“Supply chain sustainability reporting is a key part of PUMA’s overall sustainability strategy,” said Dr. Reiner Hengstmann, Global Director of puma.safe supply chain. “Without sustainable suppliers, we will not be able to produce sustainable products or credibly report about PUMA’s own sustainability initiatives. The GANTSCh project helps to ensure that our suppliers fully embrace the concept of sustainability and introduce respective programs in their companies.”

PUMA originally joined the GRI-GTZ pilot project “Transparency in the Supply Chain” which was launched in 2006 in which three PUMA suppliers in South Africa were trained and consulted on issuing sustainability reports. According to the participants, the project helped them to understand sustainability concepts through direct training from experts in the field, to learn how to measure sustainability performance by using key performance indicators, to become more transparent and learn how to report on energy consumption, waste production, work accidents and many other issues. They expanded their understanding of customers’ needs regarding sustainability issues and improved their competitive advantage and reputation.

“Some companies show consequent commitment in building a sustainable future. Puma is one of these companies,“ said Dr. Nelmara Arbex, Learning Services Director, GRI. “PUMA is not only committed to measure and manage their own impacts but they also understand that these practices have to be implemented around its business. GRI is very pleased that PUMA, which has participated in the GRI/GTZ project from the beginning, has decided to extend the GRI reporting practice to all its strategic suppliers.“ One of the participants in the pilot project, Impahla Clothing, a PUMA apparel manufacturer in Cape Town, received the ACCA Award (Association of Chartered Certified Accountants) for its maiden sustainability reports. Impahla also became the first carbon neutral garment supplier on the African continent in 2009, after the factory management was introduced to the benefits of sustainability through the project. Only recently, Impahla issued its third sustainability report. https://safe.puma.com/us/en/

The second phase of the project is currently in progress under the GANTSCh program with ten suppliers in six countries (Bangladesh, China, India, Pakistan, Portugal and Turkey) participating. Including Impahla, three suppliers already released their new sustainability reports while the remaining factories will publish their reports later in the Football World Cup year 2010.

PUMA’s mission is to become the most desirable and sustainable sportlifestyle company and it has implemented a long-term sustainability program throughout all its operations. Increasing sustainability in its supply chain through sustainability reporting is therefore an important element in PUMA’s overall sustainability strategy.

Proactively responding to accusations of low labour standards in its supplier factories by non-governmental organizations in the past, PUMA endeavours to increase transparency in its supply chain. Especially in countries such as China, India or Bangladesh, where working and living conditions differ from standards in developed countries, transparent social and working conditions play an important role in PUMA’s sustainability approach. PUMA continues to improve working and social standards through factory audits and capacity building projects over time and PUMA aims to work with the best suppliers in these countries. Sustainability reporting of the suppliers provides the opportunity to reveal what has already been achieved and where more work is necessary.

GRI’s engagement with PUMA commenced in 2006 with the generous support of the Gesellschaft für Technische Zusammenarbeit (GTZ) in the joint GRI-GTZ Transparency in the Supply Chain Pilot Project. GTZ is a federally owned, international cooperation enterprise for sustainable development with worldwide operations which supports the German Government in achieving its development policy objectives.

“Sound reporting is an important catalyst for change towards more sustainable business practices.” said Jörg Hartmann, Executive Director, Centre for Co-operation with the Private Sector/ PPP, GTZ. “I am very pleased that the pioneering „Transparency in the Supply Chain“ project set up by the GRI and the German Government four years ago is now established as a Global Action Network. I am convinced that many SMEs in emerging markets can benefit from the GANTSCh program“.

For further information on PUMA’s sustainability program, please refer to the latest PUMAVision Sustainability Report 2007/ 2008: https://ir2.flife.de/data/puma_csr/igb_html/index.php?bericht_id=1000001

For further information on GRI’s GANTSCh program, please refer to: www.globalreporting.org/CurrentPriorities/SupplyChain/GlobalActionNetwork/GAN.htm

“FLA accreditation speaks to the integrity of a company compliance programme,” said Auret van Heerden, President and CEO of the Fair Labor Association. “We review the affiliated company’s compliance activities from HQ all the way down to the factory level to ensure that they are meeting the ten Obligations of Companies set out in the FLA Charter. PUMA has met or exceeded those standards and has taken many additional steps to enhance its programme.”

PUMA has been an FLA member since 2004, when the company opened operations to external monitoring with the goal of demonstrating more transparency throughout its supply chain. PUMA received full FLA accreditation in 2007, and has just been reaccredited for its continued adherence to fair labor standards.

To earn accreditation, a company must undergo an extensive performance review. Since 2004, PUMA’s suppliers have been monitored through unannounced audits by a third party organization accredited by the FLA. Up to three percent of PUMA suppliers are externally audited by FLA approved auditors each year, with over 60 external audits conducted since PUMA joined the Fair Labor Association.

These come in addition to over 3000 internal puma.safe audits since 2001. Results from the external audits are published online on the FLA website in accordance with puma.safe’s aim of transparency. A list of PUMA suppliers is publicly available via the FLA, and a formal third party complaint procedure is also available to NGOs, unions and other interested partied via the organization.

Highlights Second Quarter:

• Consolidated sales up by 2.5%
• Gross profit margin improved to a strong 50.3%
• Overall cost structure continues to improve
• Operating result at € 64.1 million, up 1.7%
• EPS rise 16.4% from € 2.55 to € 2.97
• Integration of Cobra Golf according to schedule
• Share-buyback program initiated

Highlights January-June:

• Consolidated sales post a slight increase of 0.1%
• Gross profit margin up versus last year at 51.3%
• Strong improvement in cost structure as a result of the cost reduction program
• Operating result before special items improved to € 183.2 million , up 3.4% versus last year
• EBT increase by 185,5% to 181 million with EPS jumping to € 8.48 from € 2.92 last year
• Working Capital and Cash position continue to improve

Outlook 2010:

• Management confirms expected sales growth in the low to mid single-digits due to a strong improvement in the overall outlook
• EBIT before special items is expected to increase compared to last year
• Phase 4 Revisited (2011-2015): New refined strategy to unfold PUMA’s long-term potential will be presented with Q3 results

Jochen Zeitz, CEO: “PUMA performed according to plan in the second quarter and we are gearing up for solid growth in the second half of the year based on a strong outlook. Given an overall improvement of the global economies as well as our decisive measures taken in the past 18 months to adjust our organization and processes to the new market realities, we feel ready to re-engage with our long-term expansion plan as of next year. “Phase IV revisited 2011-2015” shall enable us to significantly tap into PUMA’s long-term sales potential of 4 billion Euros and beyond.”

Sales and Earnings Development

Global Brand Sales

PUMA’s brand sales in the second quarter – comprised of consolidated and license sales – increased by 1.3% in Euro terms.

Consolidated Sales

Consolidated sales in the second quarter increased by 2.5% in Euro terms to € 615.4 million. Currency neutral, consolidated sales softened by 4.8% on high comparables after closeout sales and a high inventory availability last year. Deliveries in June were impacted by late product deliveries and there were no pre-shipments unlike last year. On a currency-neutral basis, Footwear sales were down by 9.7% at € 321.2 million and Apparel sales fell by 5.3% to € 208.6 million. Due to first time consolidations, Accessories sales improved significantly by 20.6% to € 85.6 million.

After the first six months, consolidated sales were down by 3.7% currency-neutral but increased by 0.1% in reported terms to € 1,298.5 million. Sales in EMEA and Asia/Pacific were below last year’s levels. Sales in the Americas region, however, increased 12.7% currency-neutral despite of the overall challenging market environment after both sub regions – North America and Latin America – sustained their positive performances from the first quarter. Footwear sales declined currency-neutral by 7.2% to € 700.1 million. Apparel sales decreased by 2.0% to € 435.4 million. Accessories sales, however, advanced by 8.9% to € 163.1 million.

Gross Profit Margin

In the second quarter, the gross profit margin improved by 30 basis points from 50.0% last year to 50.3%. This increase mainly results from a lower share of closeout sales that more than offset negative impacts from currency hedging, the regional mix and higher raw material costs. After the first six months, PUMA’s gross profit margin reached 51.3% after 51.1% last year. Footwear reported 50.6% compared to 49.7% and Apparel 52.7% versus 52.3%. Accessories declined to 50.7% from 54.9% last year, which is mainly due to the increase in the scope of consolidation with the inclusion of Cobra Golf.

Operating Expenses

Operating expenses increased by 3.4% to € 250.5 million in the second quarter due to the inclusion of the Cobra Golf business into the consolidation as well as currency effects. Omitting these two factors, OPEX would be below last year. In the first six months operating expenses declined by 0.7% to € 492.8 million, which translates into a cost ratio of 37.9% after 38.2%.

EBIT

The operating result came in at € 64.1 million in the quarter after € 63.1 million last year. As a percentage of sales, the EBIT ratio dropped slightly to 10.4% from 10.5%. Adjusted by costs stemming from the Cobra integration, the EBIT margin would have improved compared to last year.

After six months, the operating result before special items increased by 3.4% to € 183.2 million from € 177.1 million, which translates into an operating margin of 14.1% versus 13.6% last year.

Financial Result/Income from associated companies

Due to lower interest rates and lower accumulation of interest on purchase price liabilities from acquisitions, the financial result in the second quarter was at € -1.5 million versus € -2.1 million last year. After six months, the financial result stood at € -2.7 million compared to € -3.7 million last year. An income of € 0.4 million was generated from associated companies in the quarter.

Net Earnings

The company’s pre-tax profit (EBT) was € 63.1 million in the second quarter versus € 61.0 million last year. Net earnings totaled € 44.8 million versus € 38.5 million, representing an increase of 16.4%. This translates into earnings per share of € 2.97 compared to € 2.55 last year.

In the first half, EBT rose significantly to € 180.9 million from € 63.4 million last year. As a result, net earnings improved by 190.4% to € 127.9 million from € 44.0 million. Earnings per share were at € 8.48 compared to € 2.92. The operational tax ratio was calculated at 29.3% versus last year’s 26.5%.

Net Assets and Financial Position

Equity

As of June 30, 2010, total assets were up by 16.1% to € 2,377.6 million. The equity ratio improved from 56.6% in last year to 61.7% in spite of a higher balance sheet total.

Working Capital

Net inventory increased by 5.7% to € 456.8 million but decreased 5.7% on a currency-adjusted basis. Accounts receivable increased by 8.1% from € 502.8 million to € 543.4 million, which compares to a currency-adjusted decrease of 0.7%. Working capital improved to € 521.7 million from € 540.6 million last year – showing again a significant improvement compared to previous quarters and thus underpinning our strong focus on managing working capital.

Capex/Cashflow

In the first six months, the company invested € 23.3 million versus € 27.4 million last year. The reduction in capital expenditure together with a solid improvement in working capital led to a strong increase in PUMA’s free cashflow before acquisitions of € 77.3 million from € 45.1 million last year. An outflow of € 101.9 million versus € 61.0 million last year related to acquisitions.

Cash Position

Given the strong focus on cash management, total cash at the end of June rose by 49.8% from € 302.7 million to € 453.4 million and bank debts declined by 28.8% from € 44.8 million to € 31.9 million this year. As a result, net cash was up from € 257.9 million to € 421.5 million this year, representing a remarkable increase of 63.4%.

Share Repurchase

PUMA AG started its share buyback program and purchased 55,892 of its own shares during the second quarter, which equals 0.4% of the share capital and reflects an investment of € 12.9 million.

Other Events

Spain Arbitration Ruling

According to an arbitration ruling the former Spanish license holder Estudio 2000 S.A., which owned several PUMA trademark rights, has been obliged to vest these to PUMA AG. Through the vesting of all of the word, image and combined PUMA trademark rights in Spain, PUMA AG would ultimately own all trademark rights and take over the operational business in Spain, hence ensuring a consistent brand management strategy. According to the arbitration ruling, the vesting of the trademark rights is subject to a one-time payment of up to 98 million Euros to Estudio 2000 S.A. However, after a thorough legal assessment, PUMA AG will challenge the ruling and believes that a favourable outcome is more likely than not. PUMA now confirms that a cancellation recourse will be filed within the next days. This potential is classified as a contingent liability which has not been recognized as a liability in the financial statements.

PHASE IV Revisited (2011-2015) – New refined strategy to unfold PUMA’s long-term potential

PUMA’s initial Phase IV expansion plan was slowed down by the global economic crisis that curbed PUMA’s sales progress. With an improved outlook of the global economy, which should lead to a reasonable market recovery, PUMA’s management is revisiting its long term development plan, leading to a refined strategy, aligned with today’s market realities, to unfold PUMA’s long-term potential. The strategy and impact of “Phase IV Revisited 2011-2015” will be laid out in detail – together with the release of PUMA’s third quarter results – on October 26th at the Brand Center of PUMAVision Headquarters in Herzogenaurach, Germany.

Outlook 2010

Given a strong outlook in sales for the second half, we continue to expect sales growth in the low to mid single digits for the full year 2010. Gross profit margins should remain unchanged to last year’s level. EBIT before special items is expected to improve compared to last year.

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This document contains forward-looking information about the Company’s financial status and strategic initiatives. Such information is subject to a certain level of risk and uncertainty that could cause the Company’s actual results to differ significantly from the information discussed in this document. The forward-looking information is based on the current expectations and prognosis of the management team. Therefore, this document is further subject to the risk that such expectations or prognosis, or the premise of such underlying expectations or prognosis, become erroneous. Circumstances that could alter the Company’s actual results and procure such results to differ significantly from those contained in forward-looking statements made by or on behalf of the Company include, but are not limited to those discussed be above.

Until the end of 2013, PUMA will continue to be the official supplier of performance, training and lifestyle apparel and footwear for Usain Bolt. Bolt will play a pivotal role in PUMA’s global marketing campaigns and serve as the central figure in the sportlifestyle company’s London 2012 Olympic program, expected to be launched early in 2011. PUMA and Bolt will continue to collaborate on the development of key product lines, building on the 2010 “Bolt Collection” launch, a range of apparel, footwear and accessories that the sprinter helped develop which include graphic elements representative of Bolt and his beloved Jamaica. Compelling new product initiatives will be launched in 2011 and the years that follow.

Bolt and PUMA have forged a close relationship over his formative years. When the World’s Fastest Man was just a boy of 16 in 2003, PUMA signed the junior sprinter. The brand and the athlete have matured together and Bolt, now 24, has emerged as the one of the world’s most talented Track and Field athletes, winning three gold medals in the 2008 Beijing Olympics and smashing two world records in the 100m (9:58) and 200m (19:19) at the World Championships in Berlin in 2009. PUMA, like many Bolt enthusiasts, believes the best is yet to come.

“Usain Bolt has been a revelation for Track & Field athletics,” said Jochen Zeitz, Chairman and CEO of PUMA AG. “He’s shined a global spotlight on the sport; his winning personality and phenomenal physical prowess are a unique combination. The way he both engages his fans and is energized by them has helped his popularity escalate to extraordinary levels over the past two years.” Zeitz continues, “Usain has been a tremendous force for the PUMA brand. He embodies the joy, playfulness and irreverence that are the cornerstone of our brand. His Lightning Bolt ‘To Di World’ pose from the Beijing Games in 2008 is now one of the most recognizable symbols in sport. He’s obviously a lot of fun to work with. From a performance standpoint, he has reset the bar for speed on the track, and we’re not sure he’s even hit his top gear yet. It’s going to be an exciting few years ahead and we’re thrilled to be along for the ride.”

“PUMA’s been by my side since the beginning, before anyone knew what I was capable of achieving,” said Usain Bolt. “They saw potential in me and they took a chance, supporting me all the way, especially when things weren’t easy for me due to injuries I suffered in my teens. We’ve been partners in the truest sense of the word since day one, and so it’s an easy decision to re-sign with them,” continued Bolt. “PUMA gets me; we fit together. They take the business of running seriously, but we also know how to have fun, to be spontaneous. We both bring a lot of personality to the sport.”

While Usain Bolt is undeniably one of the brand’s greatest ambassadors, PUMA’s investment in Track & Field in Jamaica is far more extensive than supporting him alone. Since 2002, PUMA has also sponsored the Jamaican Amateur Athletic Association (JAAA), which is the governing body for Track and Field in Jamaica, and the Jamaican Olympic Association. In addition to this, PUMA helps to foster young talent through sponsorship of 7 high school track and field programs. This partnership also drives the annual ISSA Boys & Girls Track and Field Championships, dubbed “The Champs” which is lauded as the most popular sporting event in Jamaica and the place where many of the world-renowned sprinters got their start. Additionally, PUMA is a partner of pre-Champs meets including the Gibson Relays and various Invitationals. Outside of the high school sphere, PUMA is the main partner of the Reggae Marathon, which takes place each December in Jamaica and draws distance runners from all over the world.

For more information about PUMA and Usain Bolt, please visit:

http://www.puma.com/running or www.puma.com

The more flexible and international structure of a one-tier European Corporation permits that Jochen Zeitz – in his new role as Executive Chairman of the Board – can continue to be responsible for PUMA’s next phase of its corporate development while also providing PPR’s future Sport & Lifestyle Division with his extensive and unique expertise in the sportlifestyle sector. PUMA will become a core brand within this new division.

In the role of Head of PPR’s Sport & Lifestyle Division, Zeitz will act as a member of PPR’s Executive Committee. Within the framework of the Division’s strategy developed by PPR, Jochen Zeitz will be responsible for setting up the organisation and will be in charge of operations in order to build a portfolio of strong, complementary brands within the sport and lifestyle arena in the future. These brands, and PUMA in particular, will benefit from international growth opportunities and new synergies derived from complementary consumer universes and pooled resources. Zeitz will assume his new responsibilities as Head of PPR’s Sport & Lifestyle Division after the search for a CEO of PUMA has been completed.

“I strongly believe in PUMA’s future potential as an innovation leader and icon for the sport and lifestyle industry backed by its strong brand. I am confident that Jochen Zeitz, together with the new CEO in charge of the PUMA brand, will bring PUMA to the next step. We will now look into expanding our sport and lifestyle investments in the coming years with PUMA as a core brand in our future portfolio”, François-Henri Pinault, Chairman and CEO of PPR, said.

The new management structure shall facilitate the implementation of PUMA’s five-year strategic company plan. The conversion into an SE will not infringe PUMA’s working arrangements and will proceed in close coordination with the respective employee representation bodies. PUMA’s five year strategic plan 2011-2015 will be released together with PUMA’s third-quarter results on October 26.

With immediate effect Jochen Zeitz will also assume the newly created role of Chief Sustainability Officer (CSO) at PPR. This measure not only underlines PPR’s strong commitment to Sustainability but is also a clear acknowledgement and is an opportunity to expand on PUMA’s pioneering role in this area, taking into account PUMA’s strong environmental and social commitment under the umbrella of PUMAVision.

“I will – in cooperation with the Personnel Committee – personally conduct the search for the future CEO of the PUMA brand” said Jochen Zeitz. “While all necessary preparations will be taken, I will remain CEO of PUMA. When the new CEO is appointed, I will ensure a seamless handover and implementation of the company’s five-year strategic plan which we have been diligently working on during the course of this year. After then 18 years as CEO of PUMA, I look forward to evolving my role within PUMA as well as the PPR Group and am passionate to further pursue responsible business opportunities within a sustainable social and environmental context.”