Now aged 27, Usain Bolt has been training and competing in PUMA since 2003, most recently wearing the evoSPEED performance spike which led him to the finish line at the 2012 Olympic Games in London and the 2013 IAAF World Championships in Moscow, where he won a total of six gold medals. He has been the face of multiple global marketing campaigns orchestrated by the PUMA, and will be the focus of product initiatives and brand marketing communication in 2014 and beyond.

Usain Bolt commented, “PUMA has been with me since the very beginning. They recognised my talent at an early age and have supported me throughout, especially in the early years when I had some difficult times due to injuries. Their work and commitment to Jamaica is also very important to me. I have always been very happy to be a part of the PUMA family, I am proud to represent them and delighted to continue with them for the years ahead.”

Bjoern Gulden, CEO for PUMA said, “Usain Bolt has been a partner of PUMA since he was sixteen years old. With our support, he grew from a young athlete with huge potential to a World and Olympic Champion, claiming the title of the World’s Fastest Man. We are very proud to extend our sponsorship contract with him because Usain is the perfect ambassador of the PUMA brand. He will play a crucial role in our future product concepts as well as brand communications leading towards the Olympic Games in Rio 2016 and beyond.”

In addition to its contract endorsement with Usain Bolt, PUMA has a longstanding commitment to Jamaican Track & Field. Since 2002, PUMA has partnered with the JAAA (Jamaica Athletics Administrative Association) and the JOA (Jamaica Olympic Association). PUMA also helps to foster young talent through sponsorship of high school track and field programs, and works with various grass roots activities in Jamaica.

2013 Third Quarter Facts

• Consolidated sales decline by 1.4% currency adjusted to € 813 million
• Further improvement in operating expenses, down 8% in the quarter, however not fully offsetting lower sales and gross profit decline
• EBIT before special items down to € 80 million
• EPS climbs from € 0.81 to € 3.53, due to impact from special items in Q3 2012
• Further improvement in working capital during third quarter, leading to an increase in the free cash flow

2013 First Nine Months Facts

• Consolidated sales decline by 2.5% currency adjusted to € 2.3 billion
• Gross profit margin below last year at 47.5%
• OPEX continually reduced throughout the year, in line with the ongoing Transformation and Cost Reduction Program
• Net Earnings up from € 113 million in 2012 to € 121 million in 2013
• EPS rises from € 7.53 last year to € 8.07 this year

Special items announced

• Special items of approximately € 130 million (one-off charges, primarily non cash) expected to be booked in the fourth quarter of 2013
  
  

Key Sales Figures at a Glance

Bjoern Gulden, Chief Executive Officer of PUMA SE: ”Sales and profitability for the third quarter developed as expected. Analyses have shown the need for further, mainly non-cash, one-off charges. Special items of around € 130 million are therefore expected to be booked in the fourth quarter. We know that our business is currently in a difficult position with challenging sell-throughs, sub-optimal distribution and low brand heat. But we also know that PUMA is an amazing brand with a great history, global awareness, fantastic logos, great assets and talented people. I am therefore convinced that – although it will take some time – we will turn this business around and make ‘the cat’ shine again.”

Sales Performance by Region

PUMA’s sales performance in the third quarter of 2013 was in line with full year guidance. Consolidated sales softened by 1.4% currency adjusted in the quarter. In Euro terms, sales declined by 8.9% from € 892 million to € 813 million due to the continuing currency volatility generated by several countries.

EEMEA and UK continue to grow

Third-quarter EMEA sales declined by 1.7% currency adjusted to € 378 million, as the business climate in Western Europe continued to be challenging. However, PUMA performed well in the UK, primarily due to strong sales of our Lifestyle and women’s fitness ranges. Despite these improved figures, poor consumer sentiment and depressed household spending across much of Europe, particularly in southern countries, outweighed the increases. There was, however, another encouraging performance in the Eastern European region.

Sales in the Americas were up by 0.7% currency adjusted to € 261 million in the third quarter of 2013. PUMA developed positively in North America and Argentina.
The Asia/Pacific region was weak across nearly every country in the third quarter, falling by 3.7% currency adjusted to € 174 million. The only exception was India, which delivered an encouraging performance with increased sales in the Running and Lifestyle categories.

Year-to-date regional performance varied

Consolidated sales declined 2.5% currency adjusted to € 2.3 billion in the first nine months of the year. The EMEA region was down by 3.6% currency adjusted to € 992 million. Performance in the Americas improved slightly with sales increasing by 0.4% currency adjusted to € 788 million and in Asia/Pacific sales were down by 4.5% currency adjusted to € 506 million over the period.

PUMA’s Retail Business continues to grow

In the third quarter, retail sales rose by 5.3% currency adjusted to € 161 million. For the first nine months of the year, they increased by 7.1% currency adjusted to € 446 million, equaling 19.5% of total sales. This growth was achieved despite PUMA operating a lower number of owned and operated retail stores and continues to justify the measures undertaken by the company’s Transformation and Cost Reduction Program.

Sales Performance by Segment

Footwear Sales continue to be difficult

PUMA’s third quarter Footwear sales declined by 7.1% currency adjusted to € 378 million. Although there were some positive signs from key styles in Running, Training & Fitness as well as Lifestyle, this was not sufficient to offset the downward pressure at category level. Apparel sales rose 3.4% currency adjusted to € 297 million, with nearly all Business Units up in the third quarter. Accessories likewise improved by 5.7% currency adjusted to € 138 million, thanks to an improved performance in football accessories as well as increased demand for PUMA’s socks and bodywear.

Year-to-date Footwear trend unchanged, Apparel improving, Accessories growing

In the first nine months of the year, sales in Footwear declined by 7.4% currency adjusted to € 1.1 billion. Apparel sales softened by 1.2% currency adjusted to € 780 million. Accessories continued to improve, up by 9.5% currency adjusted to € 426 million.

Margin, Expenses and Profitability 

Lower Gross Profit Margin

Due to changes in the product mix, selective discounting and currency headwinds, PUMA’s gross profit margin declined in the third quarter of 2013. Gross profit margin for the third quarter stood at 47.1%, compared to 48.2% over the same period last year. Footwear margin declined from 46.1% to 44.4%, Apparel margin was broadly unchanged at 49.9% and Accessories margin dropped from 50.6% to 48.6%.

Similarly, PUMA’s gross profit margin fell over the first nine months of the year, moving from 49.5% to 47.5%. Footwear declined from 47.9% to 44.9%, Apparel from 50.9% to 49.6% and Accessories from 51.2% to 50.2%.

Execution of Transformation and Cost Reduction Program continues

PUMA’s ongoing Transformation and Cost Reduction Program delivered further improvements to the company in the third quarter of 2013. The optimization of PUMA’s retail portfolio, where we have now closed over two thirds of the stores set out in the Program, has delivered the intended cost savings.

The company has also closed three warehouses in its efforts to streamline its logistical set up. We are also making progress on our article count reduction, with our 2013 collections streamlined by 10%.

A third consecutive quarter of OPEX reduction

As a result of the above mentioned Transformation Program, combined with ongoing cost control efforts, operating expenditures have been further reduced on a company-wide scale. Operating expenditures were once again lower when compared to last year, down 8.2% in the third quarter of 2013 from € 336 million to € 309 million.

Operating expenditures have been brought down from € 986 million to € 911 million for the first nine months of the year. As a consequence, PUMA’s OPEX ratio has decreased from 40.0% to 39.8%.

Operating Result (EBIT) before special items weakens

The continued improvement in OPEX delivered by the implementation of the Transformation Reduction Program has not been able to fully offset the current decline in sales and gross profit margin. Thus, when compared to last year, PUMA’s EBIT before special items has retreated in the third quarter from € 99 million to € 80 million. EBIT before special items also declined in the first nine months of 2013 from € 248 million to € 190 million, equivalent to a margin of 8.3%.

Financial Result

The financial result recorded for the third quarter was € -1.5 million, due mainly to continued currency fluctuations. For the first nine months similar impacts led to a result of € -9.5 million compared to € -0.9 million last year.

Net Earnings / Earnings per share improve

Consolidated net earnings rose in the third quarter of 2013 from € 12 million to € 53 million due to the impact from special items in 2012. Earnings per share improved correspondingly from € 0.81 to € 3.53. The first nine months of 2013 also saw improved net earnings from € 113 million to € 121 million. EPS therefore rose from € 7.53 to € 8.07.

Net Assets and Financial Position

Further strong improvement in Working Capital during the third quarter

PUMA’s continued focus on Working Capitalhas resulted in a decrease in inventoriesof 11.7% to € 570 million and a decrease in Group trade receivables by 16.1% to € 524 million at the end of the third quarter.

Cashflow / Capex

PUMA continued to improve Free Cashflow year-to-date, progressing from € -173 million to € -95 million. This was due to lower Working Capital needs, reduced Capex and investment activity. The Free Cashflow (before acquisitions)also improved from € -83 million to € -75 million.

Cash Position

As a result of the details outlined above, PUMA’s third quarter net cash position rose from € 205 million to € 246 million.

Brand Update

Over the last three months the new team has created a newly unified Brand Platform that will be rooted in the Sports DNA of the company, and which reconciles the Performance and Lifestyle sides of our brand. Previously, we have had two distinctive visions for each part of our business, which has led to confusion and a lack of clarity for our teams, our business partners, and ultimately our consumers.
We will start by focusing our efforts with a new mission statement – going forward, PUMA will be the Fastest Sports Brand in the World. This simplified mission will result in a single brand purpose and a single consumer message. PUMA will be: “Forever Faster“. The statement, a new tag line we will launch to consumers in 2014, reflects a 65 year history of making fast product designs for the fastest athletes on the planet.

But “Forever” references more than just our history, and our commitment to our classic products. It’s a recognition of the endless pursuit of whatever is next – in performance innovations, in cultural trends, and in style and fashion. While “Faster” is more than just delivering the rational benefit of speed to athletes, we will have a single minded purpose of celebrating faster in every sense of the word – lighter products, better fit for greater agility, enhanced benefits that allow for extended training for speed, and every other possible way we can deliver the fastest products for the fastest performers. The phrase simultaneously references the emotional benefit of owning speed – the thrill, the fun, and the swagger of Usain Bolt himself, the man who best personifies this new strategy and ambition.

Forever Faster will be a part of a long term effort to clearly re-establish our brand in the minds of our customers. The third quarter of 2014 will see the consumer launch of this new brand strategy that will also encompass a new brand campaign creative direction, supported by a large scale media campaign.

While Forever faster is the new brand platform for PUMA, it will also be the guiding principles for the company in its action and decisions: Our objective is to be fast in reacting to new trends, fast in innovations, fast in decision making and fast in solving problems for our partners. As one consequence of the new mission to become forever faster, the new management team decided to divest from our PUMA Village development center in Vietnam to accelerate PUMA’s development process by bringing our developers directly to the factories.. This step helps to streamline the processes between design and source with the intention to become leaner, more efficient and more agile within the creation process. As a further consequence, PUMA plans to relocate its international product functions from the London office to its headquarters in Herzogenaurach.

Marketing Update

At the 2013 IAAF World Championships in Moscow in August, where PUMA partnered eight national teams, the World’s Fastest Man Usain Bolt continued his reign as track and field’s biggest star, adding another three gold medals to his stash to become the most successful athlete in World Championship history. Together with his teammates, Usain helped power the Jamaican men’s team to victory in every sprint event. With six Gold medals in total, Jamaica finished third in the medal table, an excellent result for the Caribbean island and continued testament to PUMA’s product expertise in terms of speed and performance.

As he is the perfect ambassador for PUMA, the company renewed its contract with Usain Bolt in September, continuing our successful partnership up until the 2016 Olympic Games in Rio de Janeiro and beyond.

PUMA partnered Borussia Dortmund continued to enthuse the viewing public with their sensational performances – both in the Bundesliga as well as on the international stage in the UEFA Champions League – thereby cementing their position as one of the most attractive club teams in world football. While PUMA star Marco Reus continues to play a crucial role in Dortmund’s ongoing success, another talented midfielder has joined the PUMA Football family. Spanish International Santi Cazorla, who was awarded player of the year in his first season at Arsenal, is a fantastic addition to PUMA’s portfolio of international top players.

In October, our Cobra PUMA Golf athlete Lexi Thompson secured her third professional win at only 18 years old at the Sime Darby LPGA tournament in Malaysia. Her easy going personality, competitive nature and skill not only draws fans in from all over the world but also make her a perfect brand ambassador for our continuously expanding Golf category.

Outlook for the Financial Year 2013

Full-year guidance

Following third quarter sales, Management reiterates its expectations for a low to mid-single-digit decline in currency adjusted full-year net sales.

In addition, PUMA’s Management also anticipates one-off charges, the majority of which will be non-cash effective, of approximately € 130 million to be booked in the fourth quarter of 2013. The majority of these special items will consist of impairments charges related to non-current assets. New initiatives announced include the closure of the product development centre in Vietnam and the intended transfer of our international product teams from London to Herzogenaurach.

Reflecting these new elements mentioned above, Management now expects 2013 full year net earnings to be positive, but significantly below those of 2012.

Rounding differences may be observed in the percentage and numerical values expressed in millions of Euro since the underlying calculations are always based on thousands of Euro.

Media Relations:

Kerstin Neuber – Corporate Communications – PUMA SE – +49 9132 81 2984 – kerstin.neuber@puma.com

Investor Relations:

 Carl Baker – Finance – PUMA SE – +49 9132 81 3188 – carl.baker@puma.com

Notes to the editors:

• This press release and financial reports are posted on about.puma.com.
• PUMA SE stock symbol:

Reuters: PUMG.DE, Bloomberg: PUM GY,

Börse Frankfurt: ISIN: DE0006969603– WKN: 6969603

Notes relating to forward-looking statements:

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.

Over the last three months PUMA’s new management team has created a unified brand platform and simplified mission: Forever Faster. The statement, a new tag line that will launch to consumers in 2014, reflects a 65-year history of making fast product designs for the fastest athletes on the planet.

JWT will work with PUMA to develop and define a fast-moving creative process poised to capitalize on culturally relevant sporting moments. The agency will immediately begin working on a project to re-ignite the brand heat, working with PUMA to define its new Forever Faster brand messaging before rolling out a new global brand campaign in the second half of 2014.

“In JWT, we have found an agile agency with a global reach that understands the PUMA brand and culture,” said Björn Gulden, CEO of PUMA. “The team quickly proved that they could deliver on our new mission to become the Fastest Sports Brand in the World. Together we’ll craft a more nimble creative structure that will allow us to support all of the company’s sporting and lifestyle categories with a single consumer message and streamlined creative concept across territories.”

The PUMA account will be led out of JWT’s flagship headquarters in New York, with offices across the agency’s network contributing regional insight and localization of the global brand campaign.

“PUMA is more than an advertising relationship for us; it’s a true brand and business partnership,” said Peter Sherman, CEO, JWT New York. “It will be a privilege to work with this team.”

PUMA is the latest in a string of new business wins for JWT New York in the last three months, which includes a consolidation of Energizer brands and a creative assignment from Google.

Never out of the news for long, Balotelli wore PUMA boots on pitch for the first time last week in AC Milan’s game against Roma and again in the Milan Derby last night. The PUMA evoPOWER Stampa FG were covered in the news headlines that have defined his career to date.

Sports brand PUMA is proud to announce a new long-term partnership with the International Icon Mario Balotelli. The Italy Striker becomes the latest sporting sensation to join PUMA’s family of star players and athletes that includes Usain Bolt, Sergio Agüero, Cesc Fàbregas, Marco Reus, Radamel Falcao and Rickie Fowler.

Never out of the news for long, Balotelli wore PUMA boots on pitch for the first time last week in AC Milan’s game against Roma and again in the Milan Derby last night. The PUMA evoPOWER Stampa FG were covered in the news headlines that have defined his career to date.

Mario Balotelli is a key signing for PUMA and will become a key asset in PUMA’s brand and football communication over the coming years. PUMA’s long-standing partnership with the Italian Football Association (FIGC) is another strategic focus in which the Italian Centre Forward will play a significant role.

Speaking about the new partnership with PUMA, Mario Balotelli said: “This is a great move for me. From the early conversations I had with PUMA it was clear that they understand me, my personality and my ambition. The product and marketing plans they have developed are very exciting and I will be proud to be associated with everything I have seen. PUMA’s support for the Italian National team was another instrumental reason for me signing this contract and I am sure that the coming years will bring many good things for us all.”

Björn Gulden, CEO of PUMA, commented: “Mario Balotelli is a world class football player who will become a key ambassador for PUMA as his passion, speed, agility and power make him a perfect fit for our brand. With the FIFA World Cup in Brazil ahead of us, 2014 will be an important year for PUMA. Having Mario to complement an already strong sports-marketing portfolio, he will support our new brand mission ‘Forever Faster’ which will have a significant impact for the PUMA brand.”

Imagery and further assets can be downloaded from the PUMA Press Centre: about.puma.com/en/Newsroom

PUMA and Arsenal will work together to bring further innovation into the sports brand’s performance apparel range. Both organisations will work collaboratively on a global strategy to drive mutual growth across all football markets, achieved through PUMA’s global sales network, international tours and integrated marketing activities. Arsenal also presents PUMA with its most prominent platform to showcase performance products through its significant global fanbase, profile and reputation.

Having extended and deepened its relationship with the FIGC (Italian Football Federation), signed 2013 UEFA Champions LeagueTM finalists Borussia Dortmund and bolstered its player portfolio with Sergio Agüero, Cesc Fàbregas, Mario Balotelli, Radamel Falcao, Olivier Giroud and Yaya Touré amongst others; PUMA is defining itself as the clear number three football brand.

Bjoern Gulden, Chief Executive Officer for PUMA said: “Arsenal have been a key strategic target for PUMA for a number of years now. Through a clear commercial vision, a well-defined sports marketing strategy and a relentless enthusiasm within the PUMA organisation, we’re proud to have signed this partnership with a truly global football club. As we enter a new era in our company history, Arsenal represents a major commercial and marketing opportunity to reinforce PUMA’s credibility as a global sports brand, and we have full confidence the plans in place to activate this partnership will have a significant global impact.”

Ivan Gazidis, Chief Executive Officer at Arsenal Football Club said: “We are excited to be partnering with PUMA, a company whose football heritage and record of innovation have a strong affinity with our own. This represents another important step forward in Arsenal’s progression on and off the pitch.”

Imagery and further assets can be downloaded from the PUMA Press Centre: about.puma.com/en/Newsroom

Media Contacts:

PUMA
Tim Stedman, International PR, PUMA
+49 151 1474 3148
tim.stedman@puma.com

Arsenal
Mark Gonnella, Communications Director
+44 207 704 4010
mgonnella@arsenal.co.uk

Katie Baldwin, Senior PR Manager
+44 207 704 4010
kbaldwin@arsenal.co.uk

CONFIDENT THAT NEW STRATEGIC DIRECTION “FOREVER FASTER” WILL INITIATE TURNAROUND

2013 Fourth Quarter Facts

• Consolidated sales at € 698 million, a currency adjusted decline of 4.7%
• OPEX improve for the fourth consecutive quarter, down 4.8% against the same quarter last year
• EBIT before special items of € 1.1 million
• Special items of € 129 million booked, as indicated last November, consisting of mostly non-cash effective impairments
• EPS declines to € -7.71 due to impact of special items

2013 Full Year Facts

• PUMA’s full year consolidated sales are in line with guidance, declining by 3% currency adjusted to around € 3 billion
• Gross profit margin decreases to 46.5%
• Solid OPEX reduction: The Transformation and Cost Reduction Program drives the OPEX down 6.9% year on year
• Improved working capital position, led by strong focus on inventories and receivables management, resulting in a € 37 million improvement in free cash flow
• EBIT before special items reaches € 191.4 million
• EPS declines to € 0.36 due to impact of special items

Key sales figures at a glance

Bjoern Gulden, Chief Executive Officer of PUMA SE: “2013 has been a challenging year for PUMA and there is no doubt that we have issues in terms of lack of brand heat, commercial products and desirable distribution. Nonetheless, PUMA is a great brand and with our new brand positioning as the Fastest Sports Brand in the World, we have a clear vision of where we want to go. “Forever Faster” is not only our new brand statement, it is also our new mindset. PUMA is about fast products, fast athletes, fast designs and fast decision making. With the re-signing of Usain Bolt, and signing of Arsenal FC and Mario Balotelli, we further demonstrate that we are a true sports brand. Together with our great assets and new creative agency, we will launch our new campaign to the consumers in Q3/2014 which is fueled by PUMA’s biggest media investment in the last decade. This is not a quick fix, but 2014 marks the start of the turnaround”.

Fourth Quarter 2013

2013 trends reflected in fourth quarter sales performance

Group sales in the fourth quarter of 2013 remained under pressure with sales declining 4.7% currency adjusted and 13.2% in Euro terms from € 805 million to € 698 million. This drop was driven mainly by weakening currencies in Japan, Russia, Turkey and various countries in Latin America.

In the EMEA region, sales declined by 7.6% currency adjusted to € 226 million as economic conditions across most of Europe remained challenging. Solid sales growth in Russia and Turkey was not enough to offset weaker performances in Western and Southern European countries.

Revenues in the Americas region decreased by 3.5% currency adjusted to € 268 million, where solid performances in the USA and Canada were offset by decreases in Latin America. Mexico and Chile in particular declined on high comparables after strong performances last year.

Sales in the Asia/Pacific region decreased by 2.8% currency adjusted to € 205 million. While India continued to grow across multiple categories (Running, Training/Fitness), the rest of the region performed either at or slightly below last year’s levels.

In terms of segments, PUMA’s Footwear sales in the fourth quarter declined by 12.9% currency adjusted to € 291 million as pressure continued across most categories. Apparel sales fell slightly by 1.1% currency adjusted to € 284 million. Accessories sales improved by 10.6% currency adjusted to € 123 million.

Special items booked in the fourth quarter

PUMA’s gross profit margin declined from 44.6% to 43.2% in the fourth quarter of 2013. This was mainly due to selective discounting to clean up inventory and FX impacts. Footwear gross profit margin decreased from 41.8% to 39.5%. Apparel margins fell from 46.6% to 44.7% and the margin for Accessories rose from 48.0% to 48.4%.

Operating expenditures continued to decline further, thanks to the positive impact from the measures implemented in the ongoing Transformation and Cost Reduction Program. As a consequence, OPEX was reduced by 4.8% from € 322 million to € 306 million in the quarter. Despite the continuous reduction in OPEX, the decline in sales combined with the lower gross profit margin led to a decrease in EBIT (before special items) to € 1.1 million.

As announced with the third-quarter results in November last year, PUMA booked € 129 million of special items in the fourth quarter, consisting mostly of non-cash effective impairments of goodwill and trademarks as well as costs related to the strategic initiatives. Those include the centralization of PUMA’s international product functions from London and the intended centralization of Global and European Retail operations from Switzerland to its Herzogenaurach headquarters as well as the closure of the PUMA Village development center in Vietnam.

As a result, PUMA’s quarterly Operating Result (EBIT) declined to € -128 million and earnings per share fell to € -7.71.

Full Year 2013

PUMA’s full year sales declined 3% currency adjusted

Consolidated sales were in line with guidance for 2013 and declined by 3.0% currency adjusted and 8.7% in Euro terms to around € 3.0 billion. Sales in the EMEA region decreased by 4.4% currency adjusted to € 1.22 billion, where weak French and Italian markets were partially offset by a strong performance in the United Kingdom. In the Americas, sales decreased slightly by 0.7% currency adjusted to € 1.06 billion. In Asia/Pacific, sales fell by 4.0% currency adjusted to € 711 million as declines in Korea and Oceania could only be partially offset by increases in India.

Performances by segment varied. Footwear sales declined by 8.6% currency adjusted to € 1.37 billion in 2013. Sales in Apparel fell slightly by 1.2% currency adjusted to € 1.06 billion. Sales in Accessories continued to increase by 9.7% currency adjusted to € 549 million.

Sales growth continued in PUMA’s Retail Business

In line with the Transformation and Cost Reduction Program, unprofitable PUMA Stores were closed, while new stores with a particular focus on profitable new locations in emerging markets were opened. PUMA’s full year retail sales rose by 5.6% currency adjusted to € 623 million in 2013, equal to 20.9% of total sales.

Gross Profit Margin declines

PUMA’s full year gross profit margin declined from 48.3% to 46.5%, driven by Footwear gross profit margin, which declined from 46.5% to 43.7%. Looking to other categories, Apparel margins fell from 49.8% to 48.3% and margins in Accessories decreased slightly, from 50.5% to 49.8%. The reasons for the decline were increased discounting to clean up inventory, negative hedging/foreign exchange impacts and an unfavorable shift within the product and regional mix.

Transformation and Cost Reduction Program continues to improve efficiencies

PUMA continued to implement the Transformation and Cost Reduction Program throughout 2013. As a result, the company has become more efficient. PUMA’s European operations have been streamlined by consolidating 23 countries into seven areas. Furthermore, and in line with the above, six warehouses were closed in Europe in 2013. PUMA has continued to optimize the retail portfolio as outlined previously by closing 73 of the originally planned 91 stores, with the remainder to be closed during 2014. PUMA has cancelled product categories like Rugby in the northern hemisphere and Sailing that were not viable or were no longer part of the company’s core categories. The related sponsorships have been discontinued. As a consequence of these consistent efforts PUMA was able to drive down the full year OPEX, which improved by 6.9% from € 1.31 billion to € 1.22 billion.

Operating Result (EBIT) before special items weakens

The continued OPEX improvement was not enough to fully offset the decline in sales and gross profit margin. PUMA’s EBIT before special items declined from € 291 million to € 191 million for the full year, equivalent to 6.4% of sales.

Special Items

PUMA booked € 129 million in special items during the fourth quarter. The majority of the special items consist of the impairment of non-current assets, in particular goodwill and trademarks, and are non-cash effective. Other items included one-time costs associated with the strategic initiatives of the new Management team, such as the closure of the PUMA Village development center in Vietnam as well as the relocation of PUMA’s international product functions from London and the intended centralization of Global and European Retail operations from Switzerland to its Herzogenaurach headquarters.

Operating Result including special items (EBIT)

As a result, PUMA’s Operating Result including special items (EBIT) for the full year declined to € 63 million, equivalent to 2.1% as a percentage of sales.

Financial Result For the full year, PUMA’s financial result was equal to € -8.7 million, deriving mainly from foreign currency fluctuations throughout the year.

Net Earnings / Earnings per share decline

Full year consolidated net earnings fell from € 70 million in 2012 to € 5 million in 2013, with earnings per share declining from € 4.69 to € 0.36.

Net Assets and Financial Position

Working Capital position continues to improve

The Group’s working capital declined by 15.3% from € 624 million to € 528 million as result of the strong focus on inventories and receivables. Inventories decreased 5.7% from € 553 million to € 521 million at the end of 2013 and trade receivables declined by 16.5% from € 507 million to € 423 million, reflecting PUMA’s ongoing strong balance sheet management.

Cashflow / Capex

PUMA’s Free Cashflow improved from € -8 million at the end of 2012 to € 29 million at the end of 2013. This was due to lower Working Capital requirements, reduced Capex and the lower payments for acquisitions compared to last year.

Net Cash Position

PUMA’s year end Net Cash Position remained stable at € 361 million compared to last year’s € 363 million.

Dividend

The Administrative Board will propose a dividend of € 0.50 per share for the financial year 2013, the same as for 2012, at the Annual General Meeting on the 13th May 2014.

Strategy Update

In line with PUMA’s new mission to become the Fastest Sports Brand in the World, PUMA has continued to streamline its business operations to make processes faster and more efficient. In order to accelerate PUMA’s development process, the new management team took the decision last year to divest from the PUMA Village development centre in Vietnam, and also to relocate its international product functions from the London office to its headquarters in Herzogenaurach. In addition, PUMA decided to establish an end-to-end process responsibility for the whole product development process under the umbrella of PUMA Group Sourcing. Moreover, PUMA intends to relocate the PUMA Global and European Retail Headquarters as well as European E-Commerce, which are currently based in Oensingen in Switzerland, to Herzogenaurach. Through this move, the alignment and collaboration with key functions like Global Merchandising, the Business Units and the European Region will improve significantly and become faster.

With the intended closure of the Oensingen (Switzerland) office, we will also finalize the integration of PUMA Schweiz AG into the DACH area. In the future, the Swiss office will focus on Sales, with all other functions provided by the DACH Area headquarters in Herzogenaurach.

Brand and Marketing Update

In December, we announced a new long-term partnership with international football icon Mario Balotelli. As another key signing for PUMA, Mario will be a major force in driving the brand’s performance message. With his passion, speed, agility and power he is a perfect fit to support PUMA’s repositioning as a true Sports Brand and the company’s mission to be ‘Forever Faster’.

Ahead of the 2014 FIFA World Cup in Brazil, where PUMA will have a strong on-pitch presence of eight teams (Italy, Switzerland, Ghana, Cameroon, Ivory Coast, Algeria, Uruguay and Chile), we recently revealed our latest product innovation in football: PUMA’s revolutionary evoPOWER boot. Inspired by the freedom of movement of barefoot kicking, evoPOWER features the most advanced PUMA technologies to date and is scientifically proven to be the world’s most powerful football boot. The evoPOWER will be worn on pitch by Cesc Fàbregas, Marco Reus, Mario Balotelli, Yaya Touré, Dante and many others.

As PUMA enters a new era as the Fastest Sports Brand in the world, we have sealed a long-term partnership with Arsenal Football Club, representing the biggest deal in both PUMA’s and Arsenal’s history. This clearly underlines our positioning as the global number three brand in football. Effective 1st July 2014, PUMA will not only become Arsenal’s official kit partner but has also acquired wide-ranging licensing rights to drive mutual growth across all football markets.

Highlights in other PUMA categories included Usain Bolt’s fifth World Athlete of the Year award at the 2013 IAAF World Athletics Gala in Monaco, the contract extension with Swedish-born professional golfer Jonas Blixt and the signing of the Australian golf legend and Hall of Famer Greg Norman, who will once again be a global brand ambassador for Cobra PUMA Golf, collaborating on product development and sporting Cobra clubs at a variety of appearances, tournaments and events.

Outlook for the Financial Year 2014

In 2014, PUMA will reposition itself to again become a true Sports Brand. PUMA is excited to launch its new brand statement “Forever Faster” through a global media campaign in the Autumn/Winter season 2014 – the company’s biggest media campaign in the last decade. This re-ignition of the brand heat was kicked off by extending the partnership with the fastest athlete on the planet, Usain Bolt, and was further fuelled by signing one of the world’s top football clubs, Arsenal FC, and Italian superstar Mario Balotelli. Moreover, in the coming year of football, 25% of all participating teams at the World Cup in Brazil will be wearing PUMA jerseys. With the signing of iconic sports marketing assets and the launch of high performance product innovations like the world’s most powerful football boot evoPOWER, and with more to come, PUMA proves and will continue to demonstrate its competence as a true Sports Brand in 2014 and will also leverage its clear positioning in sports to sell sports-inspired lifestyle products.

In addition to increasing brand heat and upgrading the product engine, PUMA’s priorities in 2014 are to replace lower tier distribution with higher tier distribution and to improve the relationships with our retailers in order to drive sales quality and sell-through. In close collaboration with key accounts, PUMA will build dedicated product and marketing programs which will help to regain shelf space and improve sell-through. While weaker first-half sales are expected, the rebuilt trust of PUMA’s retail partners will start to materialize in the form of increased orders for the second half of the year. With the support of the Forever Faster media campaign and the partnership with Arsenal, the second half of the year is expected to compensate for the shortfall in sales experienced in the first half of the year.

PUMA therefore expects its net sales to be flat in 2014, but with improved revenue quality. Assuming minor input price inflation and stable currencies, the gross profit margin is expected to improve slightly due to sourcing improvements and favorable changes in the product mix.

Driven by strong marketing investments in media and sports assets, although combined with strict ongoing control of other costs, PUMA’s OPEX will increase. Management therefore anticipates an EBIT margin before special items of approximately 5% of net sales in 2014.

However, due to the special items booked in 2013, management expects a significant improvement in the net profit margin, which is expected to come in at approximately 3.0% of net sales. (2013: 0.2%).

2014 will be a turnaround year for PUMA where the brand will be re-established in the market place and bring PUMA back to a path of profitable and sustainable growth in the mid-term.

Rounding differences may be observed in the percentage and numerical values expressed in millions of Euro since the underlying calculations are always based on thousands of Euro.

2014 First Quarter Facts

• Stablecurrency adjusted sales of € 726 million
• OPEX improves,reduced by3.8% to € 298 million
• EBIT at € 59 million
• Continued balance sheet focus results in further working capital improvement

Key Sales Figures at a Glance

Bjørn Gulden, Chief Executive Officer of PUMA SE:“PUMA’s currency adjusted sales and operating margin for the first quarter were in line with our expectations – yet negatively impacted by adverse currency affects.During the quarter, we continued to make progress towards our mission to become the Fastest Sports Brand in the world and achieved all our key project milestones in this pursuit.We know that the repositioning of PUMA and the turnaround of the business will take time, but I am convinced that we are progressing well on all our key strategic priorities and that we have initiated the right projects to make 2014 the start of the turnaround.”

Sales performance in line

PUMA’s first quarter sales performance in 2014 was in line with our expectations. Currency adjusted sales declined slightly by 0.5% to € 726 million. This represents a decrease in reported terms of 7.1%, as currency volatility in Russia, Turkey, North America, Latin America, India and Japanhad anegative impact on sales in Euro terms.

Improved performance in EMEA

Sales rose by0.3% currency adjusted to € 337 million in the EMEA region. Russia, Turkey and the United Kingdom continued to deliver strong performances in the first quarter of 2014, which offset declines in Scandinavia and France, where wholesale revenues remained weak.

Sales in the Americas declined by 0.5% currency adjusted to € 235 million. Sales in North America improved slightly, while we recorded mixed sales performanceswithin Latin America with improvements in Chile and Argentina and a major decline in Brazil.

Asia/Pacific sales decreased by 2.1% currency adjusted to € 153 million. Sales in China were up slightly, but business in Oceania decreased. Japan also declined, impacted by weaker sales in the Golf category.

Mixed segment performance in the first quarter

Footwear sales declined by 7.1% currencyadjusted to € 321 million as the Motorsport business continued to decline in mature markets.The Teamsport category was, however,strengthened by the positive global reception of the new evoPOWER football boot during the first quarter of the year.

Ahead of the Football World Cup in June,the launch of PUMA’s football jerseys for itseight teams, including Italy, Chile and Ghana, helped Apparel sales increase by 3.0% currency adjusted to € 246 million.

Accessoriesperformed well in the first quarter, with sales increasing 9.5% currency adjusted to € 159 milliondue to continued demand for PUMA’s socks and bodywear.

Retail performance

PUMA’sfirst quarterRetail saleswere stable on a currency adjusted basis at € 124 million, with comparable sales in full-price stores and outlets up,while operating a slightly lower number of stores.Retails sales represented17.1% of total sales compared to 17.3% last year.

Gross Profit Margin decreases to 48.5%

PUMA’s gross profit margindeclined by 60 basis pointsfrom 49.1% to 48.5% in the first quarter due to negative currency impacts and changes in the regional and product mixes.The Footwear gross profit margin declined from 46.1% to 44.1%,as high margin Motorsport Footwear in particular declined. Apparel increased from 51.5% to 53.6% related to strong Teamsport business and Accessories decreased from 52.6% to 49.7% impacted by negative currency effects.

OPEX improvement in the first quarter

PUMA continued to maintain a strict approach to its operating expenditures in the first three months of the year. OPEX declined by 3.8% to € 298 million inspite of higher marketing investments.

Operating Result (EBIT) declines

Improved first quarter operating expenditurescould not fully offset weak currencies in a number of countries, which impactedreported sales,and a softening of the gross profit margin. As a result, PUMA’s operating profitdecreased from € 79 million to € 59 million for the first three months of 2014. The EBIT ratio decreased from 10.1% to 8.1%.

Financial Result improves

The financial resultimproved from € -4.0 million to € -3.2 million in the first quarter. The result remained negative due mainly to currency conversion impacts.

Net Earnings decrease

PUMA’s consolidated net earningsdeclined by 29.2% from € 50 million to € 36 million. As a result, earnings per sharedecreased from € 3.36 to € 2.38 in the first quarter of the year.

Net Assets and Financial Position

Working Capital improves

The company’s continued strong balance sheet management resulted in an 11.5% decrease in inventory to € 524 million and a 14.8% decrease in trade receivables to € 506 million. With the decline in trade payables also taken into account, PUMA’s working capital improved by 13.1% from € 775 million to € 674 million at the end of March.

Cashflow / Capex

The Free Cashflowbefore acquisitionsimproved slightly to € -132 million in spite of lower operational cashflows.

Capexincreased from € 9 million to € 12 million, which was mainly invested in the opening and refitting of selected retail stores as well as office and IT equipment.

Cash Position improved

PUMA’s net cash position improved from € 207 million to € 229 million at the end of the first quarter.

Brand Update

In March, PUMA revealed the new national kits for its eight national footballteams heading to the World Cup in Brazil this summer. The home and away kits for Italy, Switzerland, Algeria, Cameroon, Ghana, Ivory Coast, Chile and Uruguay all feature PUMA’s new football apparel innovation PWR ACTV, a first-to-market use of both athletic taping and compression within the apparel.

Cobra PUMA Golf athlete Lexi Thompson fulfilled her number one goal for 2014 by winning her first ever major. After taking the lead during the second round,Lexi shot a final round of 68 to win at the Kraft Nabisco Championship. She has been using Cobra Golf equipment and wearing PUMA Golf gear on the course since she first turned pro in June 2010.

In Formula 1, Lewis Hamilton of the PUMA-supplied Mercedes AMG Petronas team took the world championship lead from his Mercedes teammate NicoRosberg by winning his fourth race in a rowat the Spanish Grand Prix last Sunday. Lewis led from start to finish to win a tense battle with Nico, with the rest of the field far behind. With PUMA-partnered Ferrari driver Fernando Alonso currently third in the standings, the current top three F1 drivers are all equipped with PUMA products and wear the PUMA evoSPEED II Pro.

 

Strategy Update

In line with PUMA’s mission to become the Fastest Sports Brand in the World, we have continued our efforts to make PUMA faster and more efficient. This strategy encompasses the repositioning of PUMA as the World’s Fastest Sports Brand, the improvement of our product engine, the optimization of our distribution quality, and increasing the speed within our organization and infrastructure.

In terms of our brand repositioning, we have completed the definition of our brand platformand are now translating them into a marketing campaign, which will be launched in August 2014 – the biggest campaign for PUMA ever. The campaign will showcasemany of our great athletes like Usain Bolt, Mario Balotelli, Rickie Fowler, Marta and Lexi Thompson in their pursuit of our brand mantra Forever Faster.

To improve our product engine, we have adapted our design language in accordance with our new brand platform. TorstenHochstetter, our Global Creative Director, translated our brand mantra “Forever Faster” into a new distinctive design language for PUMA, which takes its clear inspirations from our heritage and our roots in sports. With innovative products and a more commercial focus, we are convinced that we will have a strong product offering in place to excite the market in Spring/Summer 2015.

We have also started to improve the quality of our revenues and distribution. Our current focus is to reestablish the relationships with our Key Accounts using dedicated product and marketing programs. With the PUMA Lab at Foot Locker, we have a large scale program in more than 100 doors in the US in place, which provide a great opportunity to showcase our brand and great products in this opinion-leading retailer. We are satisfied with the results as our comparable sales are significantly up. Furthermore, we are currently adapting our direct-to-consumer channels to our new brand direction: Our new unified eCommerce site will be launched in the USA, Europe and Russia by mid 2014 and our new retail format will launch with our new full-price store opening in Dubai in the fourth quarter of 2014.

We have also continued to make our organizational structure and setup faster. As of 2 May, our PUMA Village development center in Vietnam is closed. Our developers have moved into the sample rooms of our suppliers’ factories to speed up our development process, while our office employees moved into our new offices in central Ho Chi Minh. The property sale of PUMA Village is currently ongoing. Our relocations of the Lifestyle Business Unit from London and of the Global and European Retail Organization from Oensingen, Switzerland, to our headquarters in Herzogenaurach are in process and will be finalized by the end of May and Septemberrespectively.

Outlook for the Financial Year 2014

2014 will be a turnaround year for PUMA, where the brand will be re-established in the market place and brought back to a path of profitable and sustainable growth in the mid-term. To support this turnaround, PUMA will continue to invest strongly in marketing and sports assets, while maintaining tight control on other operating expenditures.

Based on the results of the first quarter and our assumptions at the beginning of the year, which foresaw stable currencies, our expectations for full year net sales (flat), gross profit (slight increase), OPEX (increase due to Marketing Investments) and EBIT/Net Earnings (approx. 5% / 3% of net sales respectively) remain unchanged. Given the current currency volatility, which is weighing negatively on our results, there may be a correspondingly negative impact of around 50 basis points on the EBIT and Net Earnings margin for the full year.

Rounding differences may be observed in the percentage and numerical values expressed in millions of Euro since the underlying calculations are always based on thousands of Euro.

Negative Impact of Volatile Currencies Continues

2014 Second Quarter Facts

• Currency adjusted sales increase slightly to € 652 million
• Gross profit margin improves to 46.7%, up 70 basis points vs. last year
• OPEX stable despite World Cup marketing expenditures
  EBIT of € 13 million

2014 Half Year Facts

• Currency adjusted sales flat at € 1.38 billion
• Gross profit margin stable at 47.7%
• Slight OPEX reduction of 1.2%
• EBIT of € 71 million
• EPS amounts to € 2.66
• Free cash flow increases by € 40 million due to improved working capital
• Successful launch of Arsenal partnership

Key sales figures at a glance

Bjørn Gulden, Chief Executive Officer of PUMA SE: “PUMA’s second quarter sales and operating profit developed in line with our expectations. I was very happy with PUMA’s visibility during the World Cup in Brazil. Feedback on both our dual-colored Tricks football boots and our national team jerseys with ACTV technology has been great. The sell-through of these products has been excellent and exceeded our expectations. In addition, we celebrated a successful Arsenal launch in July, followed by very good initial sales at Retail of Arsenal replica jerseys. We are now looking forward to launching our new “Forever Faster” marketing campaign in August, which is another step in the process of becoming the “fastest sports brand in the world”. But, as I have said all along: We know that the repositioning of PUMA and the turnaround of the business will take time. However, I feel we are making progress on all our key strategic priorities and we have initiated the right projects to make 2014 the start of the turnaround.”

Second Quarter 2014

Sales increase slightly

PUMA’s consolidated sales in the second quarter of 2014 were in line with expectations, rising by 0.6% currency adjusted to € 652 million. However, due to continued currency weakness in Turkey, Russia, South Africa, India, Japan and the Americas, sales declined by 5.8% in Euro terms.

Performance in the Americas improves

In the EMEA region, sales declined by 1.4% currency adjusted to € 256 million as strong performances in the United Kingdom and Switzerland could not entirely offset a decline in French and Scandinavian wholesale revenues.

Sales in the Americas increased by 4.6% currency adjusted to € 251 million, as key account initiatives like the PUMA Labs at Footlocker contributed to the performance improvement in North America, and Latin America benefited from increased Teamsport sales, particularly in Chile and Mexico.

Sales in the Asia/Pacific region declined by 2.3% currency adjusted to € 146 million despite solid growth in Korea and India, as performance in Japan was pressured by the sales tax increase at the beginning of the quarter which led to a decline across categories.

Product segment trends continue

PUMA’s currency adjusted Footwear sales declined by 9.1% in the second quarter to € 278 million despite improved Teamsport sales.

Apparel sales, however, improved by 12.8% currency adjusted to € 241 million as the World Cup supported strong performances in replica jerseys as well as training and fan wear, particularly for the Italian, Chilean and African teams.

Accessories sales also improved by 3.4% currency adjusted to € 134 million due to continued demand for PUMA’s socks and bodywear. However, Golf equipment sales declined during the quarter due to the weaker golfing environment.

Gross profit margin improves

PUMA’s gross profit margin increased from 46.0% to 46.7% for the second quarter of 2014 as promotional activities declined compared to the same period last year. Footwear gross profit margin decreased from 44.1% to 42.7% due to the product and category mix. Apparel margins rose from 47.0% to 48.2% and the margin for Accessories increased from 49.2% to 52.4%.

OPEX flat

Operating expenditures were broadly unchanged for the quarter at € 297 million, despite increased marketing expenditures associated with the World Cup in Brazil.

Operating Result (EBIT) declines

The negative currency impact on sales and gross profit led to a decline in PUMA’s operating profit (EBIT) from € 31 million to € 13 million for the second quarter of 2014. The EBIT ratio decreased from 4.5% to 1.9%.

Financial Result

The financial result improved from € -4.1 million to € -1.3 million in the second quarter. The result remained negative due mainly to currency conversion impacts.

Net earnings

PUMA’s consolidated net earnings declined from € 18 million to € 4 million impacted in part by a slightly higher tax rate in the quarter due to tax expenses related to prior years. As a result, earnings per share decreased from € 1.17 to € 0.28 in the second quarter of the year.

Half Year 2014

Currency adjusted sales were flat in the first half of 2014 at € 1.38 billion. Continued currency weakness in the aforementioned countries led to a decline of 6.5% in Euro terms.

Varied regional performance in the first half

Sales in the EMEA region declined by 0.5% currency adjusted to € 593 million, where strong performances in the United Kingdom and Turkey were not enough to entirely offset lower sales in France and Scandinavia.

Currency adjusted sales in the Americas increased by 2.1% to € 486 million with improvements in some major markets including the USA and Canada, while Chile performed well in Latin America.

Asia/Pacific sales declined by 2.2% currency adjusted to € 299 million as decreases in Japan and Oceania could not be fully compensated for by increases in India and Korea.

Apparel and Accessories increase

In terms of product segments, Footwear sales declined by 8.0% currency adjusted to € 598 million in the first half of the year. Sales in Apparel increased by 7.6% currency adjusted to € 487 million, and Accessories sales also rose by 6.6% currency adjusted to € 292 million.

PUMA’s Retail sales rise

PUMA’s retail sales increased by 2.9% currency adjusted to € 270 million in the first half of 2014, equal to 19.6% of total sales, as comparable sales in our stores improved during the period.

Gross Profit Margin stable

PUMA’s half year gross profit margin was unchanged at 47.7%. The decline in Footwear margin from 45.1% to 43.4% was offset by the increase in the Apparel margin from 49.4% to 50.9%. Accessories margin was stable at 50.9% for the first six months of the year.

Slight decline in half year OPEX

PUMA’s operating expenditure improved slightly thanks to continued expenditure discipline despite the higher marketing costs associated with an event year. Half year OPEX improved by 1.2% from € 602 million to € 595 million.

Operating Result (EBIT) lower

Weak currencies continued to impact reported sales and gross profit. PUMA’s EBIT therefore declined from € 110 million to € 71 million for the half year, equivalent to 5.2% of sales. The negative currency development during 2014, particularly in Emerging Markets, had a negative impact of approx. € 15 million on the EBIT, equal to 1.1% of net sales.

Financial Result

For the half year, PUMA’s financial result improved from € -8.0 million to € -4.5 million. The negative result was caused mainly by the impact of foreign currency fluctuations.

Net Earnings / Earnings per share decline

Half year consolidated net earnings fell from € 68 million to € 40 million, with earnings per share declining from € 4.54 to € 2.66.

Net Assets and Financial Position

Working Capital position continues to improve

PUMA’s continued emphasis on the balance sheet delivered positive results. Inventories declined by 7.9% to € 584 million and trade receivables also decreased by 9.8% to € 463 million. As trade payables remained stable, the Group’s working capital improved by 13.0% to € 596 million.

Cashflow / Capex

PUMA’s Free Cashflow improved from € -112 million to € -72 million for the first six months of 2014. This was mainly due to lower Working Capital requirements.

Capital expenditure rose from € 19 million to € 31 million as PUMA continued to invest in the opening and refurbishment of selected retail stores, as well as office and IT equipment.

Net Cash Position

PUMA’s Net Cash Position at the end of the first half of the year improved from € 233 million to € 267 million.

Brand Update

At the 2014 FIFA World Cup™ in Brazil, PUMA’s eight partnered teams secured a strong on-pitch visibility, participating in almost half of all games in the tournament. The World Cup proved to be a great stage for PUMA’s innovative football products: Both our national team jerseys featuring PUMA’s apparel innovation PWR ACTV as well as PUMA’s prominent pink and blue interpretation of its revolutionary evoPOWER and evoSPEED football boots ‘Tricks’, which could be seen in three quarters of all games, were eye-catchers, creating lots of positive headlines. Combined with high engagement rates on our social media channels, PUMA achieved its best ever sell-through of football boots, with Tricks now widely sold out.

Starting July 1st PUMA has become the official kit partner of top English Premier League club Arsenal FC. The company kicked off its new partnership with the launch of the much-anticipated new Arsenal Home, Away and Cup kits for the 2014/15 season. The jerseys were revealed through a spectacular twenty meter high water projection on London’s River Thames viewed from the North Bank, transforming the EDF Energy London Eye into the iconic Clock End. The jerseys generated impressive sell-through in its first week on sale.

The fastest sports in the world, Formula 1, is currently dominated by the world’s fastest team, PUMA-supplied Mercedes AMG Petronas, with 9 wins in the first 11 races. In a thrilling Hungarian Grand Prix ahead of Formula 1′s four-week summer break, Lewis Hamilton finished third after starting from the back of the grid. The Briton reduced the deficit to his teammate Nico Rosberg, who is still leading the drivers’ standings by 11 points after his sensational win of the German Grand Prix at Hockenheim a week before. With PUMA-partnered Ferrari driver Fernando Alonso currently ranking fourth in the standings, almost all the top drivers are equipped with PUMA race wear and the Evo Speed SLW Pro, the lightest shoe in the Motorsports world.

Strategy Update

Our strategy encompasses the repositioning of PUMA as the World’s Fastest Sports Brand, the improvement of our product engine, the optimization of our distribution quality and increasing the speed within our organization and infrastructure. In the second quarter we continued to progress well on all our key strategic priorities that are crucial to ensuring that 2014 marks the start of the turnaround.

In terms of our brand repositioning, we have created the biggest marketing campaign in PUMA’s history and are now ready to communicate the repositioning of PUMA as a true Sports Brand to our consumers and retail partners. The campaign demonstrates how our great athletes like Usain Bolt, Mario Balotelli, Rickie Fowler, Marta, Lexi Thompson and Ferrari are the epitome of our brand values: Brave, confident, determined, and joyful. The campaign will be kicked-off on August 7th in North America, Latin America and Asia-Pacific and will be rolled out to Europe and EEMEA shortly afterwards. The launch of this campaign marks the start of a long-term marketing strategy, with continuous investment up to the Rio de Janeiro Olympic Games in 2016 and beyond.

To improve our product engine, we initiated key projects to improve our product designs, develop more innovative technologies, and increase the commerciality of our product range. The first results have already been implemented for the coming Spring/Summer 2015 season, and the feedback from our retail partners, as well as our initial indications for H1/2015, make us very confident that we are heading in the right direction.

In order to improve the quality of our revenues and distribution, we are developing joint product and marketing programs with our key retailers to showcase our brand in the right retail environment and push sell-through with our partners. The PUMA Lab at Foot Locker, which we launched in Feb 2014, has developed very positively and we increased the presence to 126 doors in the US. The success of the PUMA Lab has not only improved our business with Footlocker but also generated a positive spill-over effect on to other key retailers in the US marketplace – both with performance and lifestyle accounts. In 2015, we will continue to foster our collaborations and will launch further product and marketing programs with our most important key accounts in every Region.

We have also continued to optimize our organizational structure and setup by making it faster. Our PUMA Village development center was closed on May 2nd. Our developers have moved to the sample rooms in our supplier factories and are now closer to the production process. As of May 31st, we have finalized the relocation of our Lifestyle Business Unit from London to our Headquarters in Herzogenaurach and closed the London office accordingly. The relocation of our Global and European Retail Organization from Oensingen, Switzerland, to our Headquarters in Herzogenaurach is progressing well and will be finalized as planned by the end of September.

Outlook for the Financial Year 2014

2014 continues to be a turnaround year for PUMA, where the brand will be re-established in the market place and brought back to a path of profitable and sustainable growth in the mid-term. To support this turnaround, PUMA will continue to invest strongly in marketing and sports assets, while maintaining tight control on other operating expenditures.

Given PUMA’s results in the first half of the year, we continue to expect flat full year currency adjusted net sales and a slight increase in the gross profit margin, as PUMA replaces lower tier distribution with higher tier distribution channels. OPEX is still expected to increase significantly based on increased Marketing investments, particularly in the second half of the year. PUMA’s full year guidance for EBIT and Net Earnings (approx. 5% and 3% of net sales respectively) remains unchanged from the first quarter; we reiterate that the continued volatile currency movements may have a negative impact of around 50 basis points on the EBIT and Net Earnings margin for the year.

Change of Managing Director

Andy Koehler, Chief Operating Officer (COO), informed the Administrative Board that he wishes to leave PUMA for personal reasons, effective 31 July 2014. During his time at PUMA, Andy Koehler laid the strategic groundwork to accelerate the transformation process in his area of responsibility. PUMA is thankful for his contributions and wishes him all the best for his professional and personal future. He will be available to the Kering Group as a consultant.

Lars Radoor Soerensen has been appointed Chief Operating Officer (COO) of PUMA SE as of 1 August 2014. Lars joined PUMA in November 2013 and has led the areas of Business Processes and Intelligence as well as Information Technology. Prior to joining PUMA, Lars was previously the Chief Operating Officer at Bestseller and Esprit and before that he held leadership roles at Adidas and Lego. PUMA is confident that Lars is the right person to lead its operations and looks forward to having him as its new COO.

“It is impressive to see what Borussia Dortmund has achieved in recent years – both in sports and as a business,” said Bjørn Gulden, CEO of PUMA. “We are looking forward to continuing our partnership with the club, not just as a sponsor but for the first time as a shareholder, and we will work together to reach our common goals. As one of the top clubs in Germany and Europe, Borussia Dortmund is the perfect fit for PUMA, increasing its brand awareness on a national and international level.”

“Borussia Dortmund is proud to have gained such a renowned global company like PUMA as a strategic partner, a sports company that operates at high social and ethical standards and has demonstrated sustainable interest in sponsoring Borussia Dortmund,” said Hans-Joachim Watzke, Managing Director of Borussia Dortmund. “Due to its positive energy and national and international appeal, Borussia Dortmund will be a true partner. This partnership brings not only financial benefits for Borussia Dortmund, but we are also looking forward to intensive networking with our innovative sponsor in Germany and abroad.”

PUMA has been Borussia Dortmund’s technical partner since July 2012, providing official playing kits for all associated Borussia Dortmund teams, including the senior mens and youth teams as well as replica kits, fanwear and other merchandise.

PUMA will remain a long-term partner of the FACR, supporting Czech football teams in all age and branch categories. The new agreement has also been extended to include beach football and futsal. On the threshold of the EURO 2016 qualifications, this renewal sends a strong and positive message to all football supporters in the Czech Republic.

Christian Voigt, Senior Head of Global Sports Marketing, PUMA International commented, “We are proud to renew our longstanding partnership with the Czech Republic Football Association. Next year, we will celebrate the 20th year of this partnership and we are delighted to be extending it for another long-term period. The FACR was one of PUMA’s first major football sponsorships in our company's modern era, and has played a role in PUMA becoming one of the most innovative and leading football brands. We look forward to building on the success we have enjoyed together for the coming years.”

Miroslav Pelta, Chair of FACR said, “The duration of this extended partnership between PUMA and the Football Association of the Czech Republic is testament to our mutual satisfaction and trust. PUMA has become a sponsor of ours with enhanced representation that now includes soccer futsal and beach football, which we see as an important step in strengthening our cooperation.”

Marek Drvota, General Manager PUMA Eastern Europe added, “The partnership with the Football Association is very important for us on the local level. I’m pleased that we can build on the almost-twenty-year successful partnership. Our company wants to support the Football Association both in successful times and in the times when things don’t go as expected, because this is what sports are about. We are a sport brand that wants to support all the sportsmen in the world. I believe we will manage to be a stable partner for the FACR for years to come.”