2011 Fourth Quarter Highlights

• Consolidated sales totaled in excess of € 720 million, a currency adjusted increase of 15.8%
• Gross profit margin improved to 46.7% despite continuing input price pressure
• EBIT rose by over 72% to € 48.1 million
• Net earnings more than doubled to € 33.1 million
• Consequently, EPS leapt from € 0.93 to € 2.21
• Long-term sponsorship agreement signed with German football champions Borussia Dortmund
• Multi-year sponsorship of Mercedes GP Formula 1 team announced
  
  

2011 Full Year Highlights

• PUMA delivers on its € 3 billion sales target for 2011
• Gross profit margin continues to be in the upper echelons of the industry at 49.6%
• EBIT rose by 8.6% to € 333.2 million
• Net earnings rose by nearly 14% to just over € 230 million
• EPS increased from € 13.45 to € 15.36
  
  

Outlook for the Financial Year 2012

• Management is targeting high single digit sales growth in 2012.
• PUMA enters the second year of its “Back on the Attack” strategy, continuing with the execution of selective investments into the growth drivers.
• Management foresees an improvement of net earnings in mid single-digits for the full year.
  
  

“I am pleased to see that our sales and earnings performance in the financial year 2011 bear testament to the fact that PUMA is “Back on The Attack”, and that our 5-year growth plan is already having a positive impact”, said Franz Koch, CEO of PUMA SE. “We managed to surpass our sales target this year, eclipsing € 3 billion in sales for the first time, while PUMA’s net earnings also beat management’s expectations. With the support of a strong sports marketing portfolio we are well on track to explore the opportunities of the sports year 2012 as well as achieve our 2015 goal of € 4 billion in sales. We expect a sales increase in the high single digits for this year.”

Americas region drives sales growth in the fourth quarter

PUMA’s fourth-quarter consolidated sales rose strongly to over € 720 million, up 15.8% currency adjusted and 15.6% in Euro terms when compared to last year, and surpassing all of PUMA’s previous fourth quarter results. This exceptional performance was once again underpinned by all regions, despite the continued economic uncertainty stemming from the Euro-zone debt crisis, which continued unabated during the last three months of 2011.

PUMA excelled again in the Americas, where sales grew by 27.8% currency adjusted to € 271 million. The Latin American market continued to be a significant growth driver for PUMA, and Motorsport remains the top performing category in the region. The situation in the US improved, and sales accelerated during the fourth quarter, while PUMA’s lifestyle products in particular resonated well with consumers.

Despite reluctant consumer behavior amid the Euro-zone debt crisis, EMEA sales rose by 8.3% currency adjusted to € 237 million. The UK and France performed well, while Russia was at the forefront of improved performance in Eastern Europe. Lifestyle products in particular continued to perform well, while our participation in the Volvo Ocean Race boosted sales in PUMA’s Sailing category. Fitness also posted significant growth rates.

Sales in Asia/Pacific improved by 11% currency adjusted to € 212 million. PUMA’s football shoes and lightweight running products, especially our FAAS range, continued to stand out, while growing demand came from outdoor products in the region. Results in Japan, India and Korea remained very strong while China grew at the expected rate.

PUMA’s performance in terms of segments mirrors that of the regions, in that all of them contributed strongly to the impressive performance. Footwear sales came in at € 339 million, an increase of 11.4% currency adjusted. Apparel grew by 12.7% currency adjusted to € 275 million and Accessories, including the consolidation of Cobra Golf, performed very well, up 43.6% currency adjusted to € 107 million.

Gross Profit Margin improves

In the fourth quarter, PUMA’s gross profit margin was 46.7%, up from 45.4% last year. The gross profit margin for footwear increased from 43.4% to 46.6%. Apparel retreated from 47.0% to 45.9%, whereas Accessories rose to 49.0% from 48.4%. This increase stems from the overall product mix and an acceptance of the selective price rises indicated previously by PUMA and implemented in the fourth quarter of 2011.

Fourth quarter operating expenses rose in line with our growth strategy, by 18.4% to € 292.3 million, and was equivalent to 40.6% of sales, up from 39.6% for the same period last year. This increase derives from the further investments under the aegis of our “Back on the Attack” strategic growth plan. Additional funding in IT, the supply chain, marketing and product has grown as planned, as we continue to aim for the targets set out at the end of 2010.

EBIT was up 72.6% in the fourth quarter, at € 48.1 million. This represents 6.7% of consolidated sales and is above last year’s ratio of 4.5%.

The financial result declined from € -1.2 million to € -8.9 million, largely as a result of foreign exchange impacts relating to financing activities.

EBT in the fourth quarter was up 47%, from € 26.7 million to € 39.3 million.

Net Earnings excel with a 137% improvement

Net earnings rose by € 19 million to € 33.1 million, a notable increase of 137%, meaning that earnings per share followed suit, up to € 2.21 from € 0.93 (diluted earnings € 2.21 per share versus € 0.92 last year)

PUMA achieves its goal of € 3 billion in sales for the Full Year 2011

“Back on the Attack” growth plan already having a positive impact

Much of PUMA’s success in 2011 can be attributed to its long-term strategic growth plan “Back on the Attack,” launched in autumn 2010 and implemented from the beginning of last year. PUMA’s annual results attest that this roadmap, which aims to unlock our long-term brand potential of € 4 billion in sales by 2015, has already had a positive impact on the company’s performance during 2011. One aspect of this strategy is increasing PUMA’s brand desirability by differentiating PUMA’s Performance and Lifestyle categories.

In 2011, we strengthened PUMA’s roots in performance, particularly in football, by significantly expanding the sports marketing portfolio of brand ambassadors. PUMA signed Sergio ‘Kun’ Agüero and Yaya Touré of Manchester City, Radamel Falcao of Atlético Madrid and Cesc Fàbregas of Barcelona. They will all feature as central figures in our global marketing campaigns in the coming years. PUMA signed up the reigning German football champions, Borussia Dortmund, to a new partnership as well as the South African Football Federation, the host of the next African Cup of Nations. With a portfolio of 12 African teams, we remain the leading football sponsor on the African continent. All these strategic moves underline our ambition to be the clear number 3 brand in the world of football.

Record sales increase to more than € 3 billion

Consolidated sales for the Full Year climbed 12.1% currency adjusted (11.2% in Euro terms) to just over € 3 billion. With this record result, PUMA has achieved its sales target for the full year.

Regions

Once again, all regions contributed to this excellent performance. Sales in EMEA rose by 7.7% currency adjusted to over € 1.31 billion. EMEA therefore accounted for 43.6% of total sales compared to the 2010 number of 45.1%. In the Americas, sales increased by 17.7% currency adjusted, equal to € 967 million and equal to 32.1% of total sales. Sales figures improved in every country in the region. Asia/ Pacific also recorded a double digit increase, with sales topping € 730 million, a currency adjusted increase of 13.3%. This was equivalent to 24.3% of total sales.

Segments

In terms of segments, Footwear continued to thrive, growing 9.9% currency adjusted to € 1.54 billion. Apparel rose at the same rate, surpassing the 1 billion Euro mark for the first time.

Accessories posted an impressive 27.3% currency adjusted increase, up to € 434 million, after Cobra Golf had been integrated for a full year for the first time in the financial year 2011.

Retail sales rise by € 45 million

Of the total consolidated number, retail sales were € 515 million or 17.1%. This is an increase in absolute terms of € 45 million, but a slight decrease from 17.4% of total sales in 2010. As part of our growth strategy, we are still aiming for 20% of sales to be recorded in our own retail.

Gross profit margin remains stable

For the full year, gross profit margin is stable at 49.6% (prior year: 49.7%). This was achieved in the face of higher wage pressures and increasingly volatile commodity price movements. The Footwear margin rose slightly from 48.9% to 49.1%, Apparel dropped a percentage point to 49.6% and Accessories moved up one percentage point, to 51.6%.

Operating expenses

Full year operating expenses were up, by 14.8% to € 1,178 million, in line with the “Back on the Attack” growth strategy. Marketing & Retail rose by 9.8% to € 550.7 million, but dropped slightly as a percentage of sales to 18.3%. Other Selling Expenses rose in line with sales to € 387.1 million. As envisioned under the plan, RD&D expenses rose by 21.0% to € 77.0 million, and General and Administrative expenses rose by 31.8% to € 195.3 million, due to continued investments in infrastructure and systems to build the platform for future growth. This caused the expense ratio to rise from 5.5% to 6.5%. In addition, the Company reported other operating income of € 32.2 million, compared to € 35.5 million in 2010.

Earnings

EBIT rose by 8.6% to € 333.2 million. As a percentage of sales, EBIT was 11.1% for 2011, as compared to 11.3% for 2010.

The financial result for 2011 came in at € -12.8 million versus € -5.3 million in 2010. Interest income rose by € 0.8 million to € 5.2 million, while foreign exchange rate fluctuations related to financing activities led to a negative result of € 6.9 million which did not occur in 2010. Other financial expense related items increased by € 1.4 million this year.

Full year EBT rose, by 6.3% from € 301.5 million to € 320.4 million. Tax expenses declined for the full year, by 9.4% to € 90.0 million. The tax ratio was therefore at a normalized rate of 28.1%, compared to 32.9% in 2010.

For the full year of 2011, net earnings jumped 13.8% to € 230.1 million, from € 202.2 million last year. EPS increased strongly, by 14.2% to € 15.36.

Net Assets and Financial Position

Equity

Total assets (as of December 31, 2011) stood at € 2,581.8, an increase of 9.1% from last year’s € 2,366.6 million. Inventories and trade receivables were the main contributors. The equity ratio rose from 58.6% to 62.2%, which indicates continued improvement in our capital base. In absolute figures, shareholders’ equity increased by 15.8% from € 1,386.4 million to € 1,605.2 million.

Working Capital

PUMA’s overall Working Capital increased by 32.0% to € 534.0 million. Inventories rose by 22.1% from € 439.7 million to € 536.8 million, which was necessary to accommodate our planned sales growth, and also a consequence of higher procurement prices which, amongst other things, led to this increase. Trade receivables also increased, up 19.3% from € 447.0 million to € 533.1 million as a result of our strong sales performance, particularly in the fourth quarter. Trade payables also rose strongly by 25.3% to € 431.4 million, partly balancing the increase in Working Capital.

Cashflow/ Capex

Free Cashflow for the full year dropped slightly to € 16.8 million versus € 17.1 million in 2010. With regards to our Capex, PUMA’s outgoings increased by 28.9% to € 71.1 million. As already discussed, this increase is almost entirely derived from investments in line with our growth strategy, into supply chain improvement, IT systems and the ongoing expansion of our retail store portfolio. Payments for acquisitions fell by almost 60% to € 44.2 million, as the 2010 number included PUMA’s purchase of Cobra Golf. The purchase of the outstanding stake in our China business from our joint venture partner accounted for the majority of acquisition payments made in 2011.

Cash Position

Total cash (as of December 31, 2011) fell by 6.5% to € 448.2 million. Bank debts were reduced by 18.0% to € 35.1 million. The net cash position decreased 5.4%, from € 436.8 million to € 413.1 million.

Dividend

The Administrative Board will propose to the Annual General Meeting on April 24, 2012, that an increased dividend of € 2.00 per share (€ 1.80 in the previous year) be paid for the financial year 2011, due to the improvement in net earnings and in spite of a flat free cash flow.

Share buyback

PUMA did not activate its share buyback program during the fourth quarter of 2011.
As of the balance sheet date, PUMA owned 147.831 of its own shares, equal to € 32.6 million.

Outlook

Management believes that PUMA can achieve increases in sales in the upper single-digit range in each of the next two years. This growth will be fuelled by further investments into marketing, product design and development, structure in emerging markets as well as the optimization of processes, organization and systems. Assuming moderate input cost inflation, combined with necessary operating expense increases, net earnings are expected to improve in the mid-single digit range for both years.

PROFITABILITY AFFECTED BY SLOW-DOWN IN EUROPE

Highlights First Quarter 2012

• Consolidated sales increase by 6.1% to € 820.9 million.
• Gross profit margin falls by 120 basis points to 51.2%.
• EBIT decline by 8.1% to € 102 million.
• Net earnings decrease slightly, by 4.9% to € 74 million.
• EPS decline from € 5.17 to € 4.92.
• Long-term contractual partnership with the Italian Football Federation extended.

Outlook for the Financial Year 2012

• Management reiterates full-year sales target of high single-digit growth for 2012.
• Management continues to see net earnings increasing in the mid-single digit range for 2012.

“After a strong finish in 2011, PUMA’s first-quarter sales growth could not keep pace with that of recent quarters, translating into weaker bottom line results, said Franz Koch, CEO of PUMA SE. “Our first quarter sales performance indicates that we are facing challenges in Europe. As a consequence, we have begun to respond to these challenges, optimizing the efficiency of our business model in the EMEA region. In addition, I am confident that the product innovations we have in the pipelines will contribute to achieving our full-year sales and earnings targets against the background of this extraordinary sports year.”

 

Sales Performance By Region

EMEA sales decline in a challenging consumer environment

With consumer spending remaining sluggish within the Eurozone, Sportlifestyle company PUMA’s first-quarter sales increased by 6.1% in Euro terms and 4.2% currency adjusted to € 820.9 million compared to last year.

Sales in the EMEA region softened by 1.4% currency adjusted to € 368 million, as restrained consumer spending in the wake of the financial crisis in the Eurozone continued to impact demand. In addition to the challenging overall business climate, the late arrival of winter in Europe dampened sales at wholesale accounts and retailers, which slowed the in-take of spring collections and therefore had an effect on PUMA’s first-quarter sales.

As a consequence, PUMA has begun to respond to these challenges, optimizing the efficiency of its business model in the EMEA region. To this end Sergio Bucher, formerly PUMA’s Head of Global Retail, was appointed the new General Manager for Europe. In line with the transformation outlined in the “Back on the Attack” growth strategy, the company is currently in the process of streamlining the country organizations and centralizing some of the back-office functions on a regional level.

A strong sales performance in Asia/Pacific and the Americas counterbalanced the softening sales in the EMEA region. Fuelled by growth in India, Korea and Japan, which all saw significant demand for PUMA’s Motorsport, Running and Lifestyle products, Asian sales climbed 10.2% currency adjusted to € 192.1 million.

Sales in the Americas improved by 8.5% currency adjusted to € 260.8 million. Within the Latin American region, Mexico, Argentina and Brazil in particular posted strong, double-digit growth rates. North America was up, supported by the new joint ventures Wheat Accessories and Janed socks and bodywear.

 

Sales Performance By Segment

Footwear sales soften primarily in mature markets
 

Footwear sales declined 2.1% currency adjusted to € 414.6 million in the first quarter. However, PUMA has seen promising results of some of its major recent footwear product launches.

For example, the ARCHIVE LITE, an ultralight shoe with a contemporary look, is generating a double-digit sell-through in key leading doors in various countries in Europe and Asia. These styles have a distinct unique selling point, are bold, young and colorful and are the proof that PUMA is heading in the right direction. PUMA has extended its Lightweight Concept, incorporating further styles for the fourth quarter to fully capitalize on this opportunity.

The relevance of the Lightweight concept also applies to PUMA’s Performance categories. In 2012, PUMA’s Year of Speed, the company will be launching a new performance collection at the end of May that for the first time encompasses all of PUMA’s sport categories. Inspired by Usain Bolt, the collection answers every athlete’s need for speed by taking performance technology and innovations, and incorporating them in footwear and apparel developed for various sports.

Sales in the Apparel segment climbed 8% currency adjusted to € 267.6 million. The Lifestyle and Performance collections resonated well with consumers in all markets. Running, Lifestyle and Golf apparel products in particular were in demand. PUMA further expects an increase in Apparel sales on the back of UEFA Euro 2012.

Accessories jumped 19% currency adjusted to € 138.7 million, where Cobra PUMA Golf continues to deliver an outstanding performance, while the new joint venture for socks and bodywear in the North American market follows suit.

PUMA’s Teamsport category was further strengthened in the first quarter by the signing of a long-term sponsorship contract with the Slovak Football Association, and the confirmation of a new long-term contractual partnership with the Italian Football Federation that sees PUMA now actively managing the entire licensing portfolio of the Federation’s assets on a global basis. PUMA also expanded its international club portfolio by signing the Brazilian Club Botafogo from Rio de Janeiro and the Italian Serie A club US Palermo. In addition, PUMA extended its partnership with French football club Girondins de Bordeaux. The Teamsport business is expected to benefit not only from these new acquisitions, but also from the UEFA Euro 2012 in Poland/ Ukraine in June.

PUMA Running was driven by the light-weight PUMA Faas range, which includes the ongoing best-seller PUMA Faas 300. The Running category will receive a further support in the second quarter with the unveiling of Olympic performance and lifestyle collections of the Jamaican athletics team designed by Cedella Marley, daughter of Reggae legend Bob Marley, at the beginning of June.

Motorsport remained active during the first quarter. PUMA boosted its Formula 1 portfolio by signing new contracts with Mercedes GP Petronas. Nico Rosberg then provided the perfect start to this partnership, scoring his maiden F1 victory in his Mercedes AMG Petronas car at the Chinese Grand Prix in Shanghai two weeks ago.

Sales in Sailing also continued to increase as the marketing activities around the Volvo Ocean Race and the press coverage of PUMA’s most recent success in this ocean marathon have been positive. In the current America’s Cup World Series PUMA, who serves as the exclusive licensee for the America’s Cup Event Authority and the PUMA-sponsored Team ORACLE Racing, are getting prepared for the next exciting regattas in Venice in May and Newport, Rhode Island in June.

Expenses and Profitability

Gross Profit Margin softens to 51.2% in the first quarter of 2012
 

Input price pressures were mainly responsible for the drop of the gross profit margin in the first quarter, which comprised 51.2% of group sales, down from 52.4% at the same point last year. Hedging also had a negative effect, as did the product and regional mix.

As a consequence, Footwear fell back from 51.3% to 49.5%, Apparel dropped slightly from 53.7% to 53.5% and Accessories declined from 54.0% to 51.9% which is mainly due to the first time inclusion of the newly added US sock and bodywear business, which carries lower margins.

 

Satisfying retail performance

Retail sales constituted € 122 million, or 14.9% of total sales, in the first three months of 2012, an improvement of 15.2% year on year, underlined by positive comparable sales in the current store portfolio and newly opened stores in 2012.

 

Operating Expenses rise as growth strategy is implemented

Operating expenses rose by 8.0% to € 322 million in the first quarter of 2012, as the “Back on the Attack” growth strategy continues to be implemented. This represents 39.3% of group sales compared to 38.6% in 2011. This increase was mostly due to rising marketing, research, design and development expenditures. Another component of the increase is the expansion of the retail store portfolio over the past twelve months.

 

Operating Result (EBIT) impacted by drop in gross profit margin

Operating profit declined in the first three months of 2012 from € 111.0 million to € 102.0 million, caused mainly by the drop in gross profit margin. The moderate increase in operating expenses was in line with PUMA’s plans. As a consequence, the EBIT ratio decreased from 14.4% last year to 12.4% this year.

 

Financial Result / Income from associated companies improves

The financial result improved from € -0.2 million to € 1.1 million in the first quarter due to positive currency developments.

Earnings before Taxes (EBT) lower

PUMA’s first-quarter EBT was lower at € 103.1 million in 2012 compared to € 110.8 million in 2011, representing 12.6% of group sales compared to 14.3% at this time last year. Tax expenses also fell from € 33.1 million to € 27.9 million, representing a tax rate of 27.1% versus 29.9% for the comparable period in 2011.

Net Earnings drop slightly

Consolidated net earnings dropped slightly by 4.9% from € 77.7 million to € 73.9 million. Earnings per share therefore also fell back from € 5.17 in 2011 to € 4.92 in the first quarter of 2012.


 

Net Assets and Financial Position

Equity rises
 

Total assets as of March 31st rose by 7.9% from € 2,303 million to € 2,486 million due to increases in both inventories and trade receivables. The equity ratio moved up from 60.6% to 66.4% when compared to the first quarter of 2011, once again strengthening the capital base. Shareholder’s equity is now equivalent to € 1,652 million, up from € 1,396 million.

 

Working Capital increases

PUMA’s overall Working Capital increased by 21.0% to € 723.7 million. Looking at assets, inventories rose by 26.4% to € 587.1 million. This is mainly due to anticipated sales growth in the upcoming quarters, continuous expansion of our retail store network and higher average prices per unit. Trade receivables also increased by 7.4% to € 620.5 million, broadly in line with sales growth.

 

Cashflow (before acquisitions) remains constant

The Free Cashflow (before acquisitions) remained constant at € -111.5 million. Outflows consisted mostly of working capital increases. The payments for acquisitions relate to the purchase of the outstanding Dobotex shares, effected on the 1st of January 2012.

Capex continued to increase by 28.1% to € -13.8 million and went mainly into Retail stores, supply chain initiatives and IT projects as “Back on the Attack” investments continued.

 

Cash Position reduced

The Total cash position was reduced by 18.3% from € 300.8 million to € 245.8 million, caused by the purchase of the remaining Dobotex shares. Including stable bank debts, the net cash position finished at € 203.2 million.

Outlook for the Financial Year 2012

PUMA’s management has taken actions to improve the company’s cost structure and strengthen product desirability to foster sales growth and profitability. PUMA is confident of achieving the full year targets as outlined in the 2011 annual report. Management continues to foresee sales increases in the high single-digit range and an increase in net earnings in the mid-single digit range for the full year.

Performance Third Quarter 2012

• Consolidated sales increase 6.0% in Euro terms
• EBIT before special items decreases by 16.7% to € 98.8 million
• Special items € 80 million due to Transformation and cost reduction program
• EPS down from € 5.45 to € 0.81

Performance First Nine Months of 2012

• Consolidated sales grow 7.8% in Euro terms
• EBIT before special items reduced by 13.0% to € 247.9 million
• EBIT including special items € 168.6 million
• EPS declines from € 13.15 to € 7.53
• Equity ratio improves from 62.9% to 65.2%

Outlook for the Financial Year 2012

PUMA’s Management maintains its 2012 sales guidance at a mid-single digit rate in Euro terms.

• Transformation Program complemented by immediate cost cutting measures as the difficult business environment in particular in Europe required short-term adjustments.
• Management expects annual net earnings to be significantly below those of 2011, impacted in particular by the one-time expenses.

“PUMA posted a moderate increase in sales in the third quarter despite the challenging business climate in Europe,” said Franz Koch, CEO of PUMA SE. “We have taken decisive actions to overcome the issues we are currently facing in particular in Europe. Our Transformation Program 2010-2015 in combination with immediate cost cutting measures and a strengthened product pipeline in Performance and Lifestyle for next year will provide a solid basis for sustainable and desirable growth.”

Challenging Business Climate in Europe continues to slow down sales growth

 Sales Performance by Segment

PUMA’s third quarter consolidated sales grew by 6.0% in Euro terms and by 0.5% currency adjusted to € 892.2 million.

Footwear sales rose by 2.5% to € 441.9 million, supported by continuing demand for the lightweight running footwear range PUMA Faas and also Heritage styles such as the evergreen Suede Classics and our Archive Lite Mid and Low designs. PUMA’s success in its running footwear range was underlined by the Olympic Summer Games that saw PUMA’s blend of Sportlifestyle at its best: Outstanding athletic performances, combined with cool events in town. However, the positive performance in our Running category was dampened by declines in the Fitness & Training and Motorsport categories in PUMA’s mature markets.

Apparel sales increased by 5.6% to € 311.2 million, fueled not only by continued strength in our Cobra PUMA Golf division, but also by sales of replica jerseys as part of our Teamsport category. PUMA has had tremendous success with Borussia Dortmund replica and fan wear, which has played an important part in our sales performance in Germany this year.

Accessories continued to climb strongly, up 20.1% to € 139.1 million with strong results in our American sock and bodywear business and also in Golf. In September, PUMA was part of a sensational finish at the 2012 Ryder Cup when Cobra PUMA Golf athlete Ian Poulter, the undisputed player of the tournament, won all four matches he played in the prestigious competition between the best golfers from Europe and the USA.

Over the first nine months of this year, consolidated sales improved by 7.8% in Euro terms or by 3.3% currency adjusted to € 2.46 billion. Footwear sales rose 2.2% in Euro terms, Apparel sales were up 9.8% supported by strong sales in Running and other performance items, and Accessories rose 23.4%, with Cobra PUMA Golf products resonating well with consumers.

Sales Performance by Region

 Growth continues in the Americas

In regional terms, sales in EMEA declined by 3.4% to € 396.7 million as the economic slow-down in Europe and restrained consumer spending continued to have a severe impact on PUMA’s business performance. Strong numbers from Germany and Russia could not completely offset the slowdown elsewhere. However, PUMA continued its excellent performance in the Americas with sales growing by 20.5% in Euro terms (10.6% currency adjusted) to € 283.2 million in the third quarter, with Argentina, Brazil and Mexico all providing strong double digit increases and continued growth in North America. Asia/Pacific posted a gain of 8.3% in Euro terms to € 212.3 million with good numbers from Korea and India in particular. Growth in China has slowed down due to a challenging overall market environment and high inventory levels in the market.

First-nine-month sales in EMEA were down 2.5% with most markets in Western Europe continuing to face challenges, although Germany returned satisfying figures, as did Turkey. Conversely, sales in the Americas rose strongly by 18.3% with good results across both North and Latin America. North America benefitted in particular from continued growth in our socks and bodywear subsidiary as well as Cobra PUMA Golf. Asia/Pacific increased by 14.9%, supported again by excellent numbers from India and also Japan.

Sales Performance Retail

 Retail continues to grow

PUMA’s owned and operated retail operations generated higher sales numbers. Third-quarter retail sales were € 165.0 million, an increase of 22.7% compared to € 134.0 million for the third quarter of 2011 and equal to 18.5% of total sales. For the first nine months to the end of September, retail sales were up 20.4% from € 363.0 million to € 437.0 million, delivering 17.7% of total sales compared to 15.8% at the same stage last year. Comparable sales rose at existing stores and PUMA continues to open new selective stores in profitable locations. However, a considerable amount of retail stores in mature markets are not generating satisfying contributions and will be part of the retail store network optimization. PUMA’s e-commerce business is growing and has contributed positively.

Margins, Expenses and Profitability

 Gross Profit Margin fell in Q3 and for the first nine months of 2012

The gross profit margin declined to 48.2% in the third quarter of 2012, under pressure from input costs and unfavorable trading conditions in Europe. Footwear fell from 49.8% to 46.1%, mainly impacted by inventory clearances which have led to a stock reduction in the footwear category in the third quarter, ahead of the launch of our new ranges for Spring/Summer 2013. Apparel fell marginally from 50.3% to 50.1%. Accessories, however, rose from 50.0% to 50.6% compared to 2011.

On a nine-month basis, the gross profit margin declined 110 basis points from 50.6% to 49.5%. Footwear fell from 49.8% to 47.9%. Apparel remained steady at 50.9% while Accessories moved lower from 52.4% to 51.2% due to higher input costs and the competitive Teamsport business.

Operating Expenses increase

Third-quarter operating expenses rose by 9.5% to € 336.1 million in the third quarter of the year compared to € 307.0 million last year. Retail costs have continued to rise as PUMA has increased the number of retail stores it owns and operates, whilst the Olympics and associated costs meant that marketing was significantly higher than over the same period in 2011. As well as continuing to invest steadily in RD&D in order to further strengthen our product portfolio, we are continuing to enhance our supply chain and IT-systems.

For the first nine months of 2012, OPEX rose by 11.3% or € 100.5 million from € 885.5 million to € 986.0 million, impacted as above by increased marketing, retail and RD&D expenditures as well as investments in line with the accelerated Transformation Program. The OPEX has also been impacted by currency effects which alone led to an increase of 450 basis points.

Operating result before Special Items

As a result of the lower gross profit margin and increased operating costs related to the Transformation Program, the operating result before special items declined by 16.7% to € 98.8 million during the third quarter of 2012. On a nine months basis EBIT before special items fell by 13.0% to € 247.9 million, an EBIT margin of 10.1%

Special Items

PUMA recorded a total of € 80 million in special items that are related to the Transformation Program during the third quarter. These have been mainly incurred by restructuring the European region, optimizing the retail portfolio and reorganizing its global operations and functions.

EBIT after special items

EBIT including special items were equal to € 19.6 million for the third quarter and € 168.6 million for the nine months to the end of September.

Financial Result

The financial result was positive at € 1.7 million compared to € -2.1 million in the third quarter of 2011, due mainly to positive currency developments. Similarly, for the year to date, the financial result improved from € -3.9 million to € -0.9 million.

Earnings before Taxes

PUMA’s third-quarter EBT was down 81.7% to € 21.3 million. The quarterly tax ratio decreased from 30.0% to 27.7%.

EBT also fell for the first nine months of the year from € 281.1 million to € 167.7 million after special items, a drop of 40.3%. The company reported an improved tax rate of 28.9% compared to last year’s 30.0%.

Net Earnings decline

As a consequence of continued pressure on the gross profit margin, increased expenditures and the special items in particular, consolidated net earnings fell by 85.1% to € 12.2 million. Earnings per share therefore fell to € 0.81.
For the first nine months of 2012, net earnings weakened by 42.8% to € 112.8 million and EPS decreased to € 7.53.
Net Assets and Financial Position

Equity

Total assets as of September 30, 2012 grew by 6.5% from € 2,423 million to € 2,580 million, mainly due to an increase in inventories. The equity ratio improved from 62.9% to 65.2% when compared to the third quarter of 2011. In absolute figures, shareholders’ equity increased by 10.3% from € 1,524 million to € 1,682 million.

Working Capital related Assets and Liabilities

Looking at assets, inventories rose by 21.3% in Euro terms to € 646.0 million or 16.8% currency adjusted. This increase is significantly lower than in previous quarters and testament that our efforts to reduce the current over-stock levels have been successful in the quarter. Inventories have generally advanced in the wake of continued retail expansion as well as higher average prices per unit on stock. Trade receivables rose only slightly to € 623.7 million, which is due to a sharper focus and reflects PUMA’s dedication to improve outstanding days. On the liabilities side, trade payables fell slightly to € 382.9 million.

Cashflow/ CAPEX

The Free Cashflow (before acquisitions) came in at € -82.7 million compared to € -89.4 million for the same period in 2011, with working capital increases offset by lower tax payments. The payments for acquisitions relate to the purchase of the outstanding Dobotex shares, effected on January 1, 2012.
CAPEX increased by 21.4% to € 54.2 million and continued for the most part to be related to investments aligned with the “Back on the Attack” growth plan, such as supply chain initiatives, IT projects and profitable retail store extension.

Cash Position

The total cash position as of September 30, 2012 was reduced by 9.4% from € 289.5 million to € 262.2 million, affected by the purchase of the remaining Dobotex shares. Including bank debts, the net cash position decreased 19.5% from € 255.1 million to € 205.4 million.

Implementation Status of PUMA’s Transformation Program and Cost Reduction Measures

PUMA has progressed with and has already begun to implement major parts of its Transformation Program which was introduced in 2010 as a new development phase with the aim to reduce complexity and increase operational efficiencies in the long run. In addition, immediate cost reduction measures were initiated to improve the overall current financial performance.

New Regional Business Model: At the core of the program is the setup of a new regional business model which will initially be rolled out in Europe and then gradually be extended to the remaining regions. The European organizational structure has now also been expanded to include several central and eastern European Union member states (Czech Republic, Poland, Hungary, Slovakia and the Baltic nations). Furthermore, PUMA has reduced the number of organizational entities from 23 countries to seven areas in order to reduce complexity of the business. Each area has a full management team and P&L responsibility, while each country will focus its activities on the commercial side of the business. The seven areas are: DACH (Germany, Austria, Switzerland), IBERIA (Spain, Portugal), UKIB (Belgium, Ireland, Luxemburg, Netherlands, UK), NORDICS (Denmark, Finland, Norway, Sweden) EASTERN EUROPE (Czech Republic, Estonia, Hungary, Lithuania, Latvia, Poland, Slovakia), FRANCE and ITALY.

Consolidation of Warehouse Portfolio: Correspondingly, PUMA has initiated the consolidation process of its warehouse portfolio across Europe in order to generate further efficiencies and cost savings with the long-term objective to align the warehouse network with the new area structure.

Optimization of Retail Portfolio: PUMA has decided to close a total of approximately 80 unprofitable stores with the focus on mature markets, while the company will continue to open new selected stores in profitable locations primarily in emerging markets. By the end of December 2013, PUMA aims to operate around 540 stores worldwide, compared to its current 590 stores.

Termination of Collaboration and Endorsement Contracts: PUMA has decided to divest unprofitable collaborations and endorsement contracts in line with the overall consolidation of its product portfolio.

Reducing Product Collections: PUMA is planning to downsize its overall product palette by 30% by the end of 2015. The number of articles has already been aligned with the company’s core categories. The major portion of the article reduction will come from streamlining regional and local ranges. The first significant results of this rationalization and simplification will be visible in Spring/Summer 2013.

Establishment of Business Units: PUMA will evolve its international organization establishing seven Business Units (Teamsport; Running, Training and Fitness; Golf; Fundamentals; Motorsport; Lifestyle; Accessories and Licensing). Product management, design, development and product-specific marketing will be clustered under each Business Unit. Establishing the Business Unit structure will help PUMA to press ahead with its sharpened focus on Performance as well as Lifestyle categories.

Further actions are currently under investigation, to be put in place during the fourth quarter of the year.

Outlook for the Financial Year 2012

Against the backdrop of a difficult business environment in particular in Europe, PUMA’s management has complemented its 2010-2015 Transformation Program with immediate cost reduction measures. The above actions require one-time costs of € 80 million which were booked in the third quarter. PUMA expects that these one-time expenses will be amortized within two to three years.

PUMA’s management continues to forecast annual sales rising by mid-single digits in Euro terms and net earnings significantly decreasing from last year’s level due to the aforementioned one-off expenses.

2013 Second Quarter Facts

• Consolidated sales decline by 4.0% currency adjusted to € 692 million
• Strong sales growth in the UK, India and Russia
• Southern Europe and the Far East remain challenging
• Ongoing Transformation and Cost Reduction Program implementation leads to lower operating expenses
• EPS retreats from € 1.78 to € 1.17
• New CEO, COO and Global Creative Director have taken up office
• Multi-award winning Mobium Elite running shoe is gathering momentum

2013 First Six Months Facts

• Consolidated sales decrease by 3.1% currency adjusted to € 1.47 billion
• Gross profit margin equal to 47.7%
• EPS amounts to € 4.54

Michael Laemmermann, Chief Financial Officer of PUMA SE: “Despite sluggish performances in Southern Europe and the Far East as well as currency headwinds impacting sales, PUMA’s second quarter performance was in line with our full-year guidance. We have pushed forward with our Transformation and Cost Reduction Program and continued to reduce the number of underperforming retail stores. With our new Chief Executive and Chief Operating Officers as well as Global Creative Director onboard, we are well positioned to secure profitable, long term growth.”

Sales Performance by Region

PUMA’s consolidated sales declined by 4.0% currency adjusted from € 753 million to € 692 million as a result of lower sales in all regions during the second quarter of 2013. Sales in Euro terms fell by 8.0% due to negative currency effects in various countries, notably in Japan, Argentina and South Africa.

Eastern European growth boosted by Russian Market

The EMEA region recorded a decline of 4.7% currency adjusted with sales of € 266 million in the second quarter. PUMA’s sales performance in Eastern Europe bucked the current sluggish business trend in Europe, delivering mid-single digit sales growth currency adjusted. Russia in particular rose strongly, delivering strong double-digit currency adjusted growth against a background of continuing retail portfolio optimization. Sales in Turkey rose likewise, driven in particular by an improved retail performance. However, these excellent performances were more than offset by slowing sales in Western and Southern Europe with France and Italy in particular not meeting expectations within the region.

In the Americas sales softened by 1.3% currency adjusted to € 267 million in the second quarter of 2013, including strong comparables. While sales in the US market decreased slightly and performance in Chile slowed, Canada and Argentina improved significantly. Golf products resonated particularly well with consumers in Canada, while in Argentina improved product availability due to increased local production underpinned strong sales growth.

Sales in the Asia/Pacific region fell by 7.2% currency adjusted to € 159 million, declining in nearly all markets. Although India continues to deliver another excellent quarterly performance, where our cricket offering continues to perform, and sales in Japan were positive on a currency adjusted basis, this was compensated by slow-downs in Korea and China, where some wholesalers have consolidated and high inventories persist within the market.

Mixed half-year regional performance

During the first six months of 2013, sales in EMEA declined by 4.8% currency adjusted to € 614 million as major markets continued to underperform. However, the Americas performed much better, with sales being up slightly by 0.2% currency adjusted to € 527 million. Asia/Pacific finished down by 5.0% currency adjusted at € 333 million for the first half of the year.

Retail Business continues to grow as Transformation Program takes effect

PUMA has continued to optimize its retail portfolio, notably by closing non-performing stores in line with the Transformation and Cost Reduction Program. This, combined with the opening of new, profitable stores and an improved e-commerce platform, has helped to propel PUMA’s retail performance. Retail Sales increased by 3.4% currency adjusted in the second quarter to € 149 million and by 8.1% during the first six months of the year to € 284 million, which represents 19.3% of our total sales.

Sales Performance by Segment

Innovative Running Shoe Mobium is making Strides

Currency adjusted Footwear sales moved down by 7.3% to € 330 million in the second quarter of 2013. Although our Lifestyle category continues to perform well, Motorsport did not meet expectations and Teamsport was lower due to high comparables from last year’s sales triggered by the Euro 2012. However, PUMA’s top-selling adaptive running shoe Mobium Elite has won multiple awards. It has garnered accolades across the globe, including Most Innovative (Competitor Magazine/US), Best New Technology (Go Multi/South Africa) and Best Debut (Runner’s World China). PUMA’s Mobium Elite will continue to evolve and thrive with new colors and hues available in the coming seasons. The new evoSPEED football boot, which was launched in the second quarter, is also off to a good start with positive sell-through rates at major football specialty retailers.

Sales in the Apparel segment declined by 6.8% currency adjusted to € 227 million. While the Lifestyle and Fitness categories remained below expectations in the second quarter, PUMA’s football category benefitted from Borussia Dortmund’s outstanding performances in the Champions League.

Accessories climbed by 10.9% currency adjusted to € 136 million, as our joint ventures for socks and bodywear continued to outperform. Cobra PUMA Golf – one of PUMA’s currently most successful categories – grew by double digits. Golf professional and PUMA partner Jonas Blixt recently underscored Cobra PUMA Golf’s burgeoning reputation, winning the Greenbrier Classic, his first US PGA tournament of the year. With his Cobra Clubs and PUMA Apparel and Footwear, Jonas cleared up the field to win by two strokes.

Varied half yearly segment sales

Footwear sales in the first half of the year were down by 7.5% currency adjusted to € 703 million. Likewise Apparel, where sales retreated by 3.8% currency adjusted to € 483 million. Accessories, however, advanced by 11.4% currency adjusted to € 288 million.

PUMA has had great successes with its partnered athletes and teams in the first half of the year. The focus now turns to the Track & Field World Championships in Moscow in August, where PUMA will be partnering eight national teams in the competition. Their performances will not only further improve PUMA’s brand visibility but also our product expertise in the Running category.

Transformation and Cost Reduction Program in line with plan

PUMA continued to realize its quarterly objectives in effecting the Transformation and Cost Reduction Program during the second quarter of 2013. The company’s retail portfolio delivered growth whilst being optimized, as unprofitable stores were closed and at the same time new, profitable stores opened in the second quarter. PUMA has now closed 60 stores within the Transformation Program since the beginning of the year, which also impacted the total sales number.

In line with the Transformation and Cost Reduction Program, PUMA has also continued with its divestiture of non-core marketing and sponsorship assets and will continue to do so in the second half of the year. In addition, there has been further streamlining within PUMA’s European operations, as the organization follows its path towards a more efficient, fully regional setup, and also amongst our business unit structure, both helping us to become a more market and consumer focused organization.

This is all part of the management’s clear aim of invigorating the brand desirability and rejuvenating the product offering, with a sharp focus on core markets and categories. PUMA continues to foster an entrepreneurial culture and cultivate strong sales forces in its markets, thriving on the high motivation of its employees.

Margin, Expenses and Profitability

Gross Profit Margin abates

The expected pressure on margins continued during the second quarter of 2013, pushing PUMA’s gross profit margin down from 49.1% to 46.0%. Ongoing currency headwinds arising from negative hedging positions compared to the same period last year, increased promotional activity as well as the regional and Footwear product mix combined to exert pressure on the margin. Footwear margin dropped from 48.3% to 44.1%, further impacted by discounts. Apparel fell from 49.4% to 47.0% and Accessories fell from 51.1% to 49.2%

The gross profit margin also declined over the first six months of the year from 50.2% to 47.7%. Footwear moved down from 48.9% to 45.1%, Apparel retreated from 51.5% to 49.4% and Accessories ebbed from 51.5% to 51.0%.

Maintained OPEX focus delivers an improved OPEX ratio

As PUMA continues to implement the Transformation and Cost Reduction Program laid out last year, the Company continues to benefit in terms of reduced operating expenditure throughout the firm. Operating expenditures declined by almost 11% from € 327 million to € 292 million during the second quarter of 2013, underpinning our efforts to further improve the overall efficiency of our organization. This OPEX reduction has resulted in a decrease in the OPEX ratio by 130bps year-on-year to 42.2% in the second quarter.

OPEX also fell during the first half of 2013 compared to 2012 and improved from € 650 million to € 602 million, with OPEX ratio decreasing to 40.8%.

Operating Result (EBIT) weakens

Although, and as mentioned above, PUMA continues to achieve significant savings through the Cost Reduction Program, those could not offset the decline in sales and gross profit margin. As a result, EBIT declined from € 47 million to € 31 million in the second quarter. Similarly, half-year EBIT declined from € 149 million to € 110 million, equal to an EBIT margin of 7.5%.

Financial Result

The second quarter financial result was broadly stable at € -4 million. Currency fluctuations during the first half of the year moved the financial result down from € -3 million to € -8 million compared to last year.

Earnings before Taxes (EBT) soften

EBT for the second quarter was down from € 43 million to € 27 million with tax expenses also declining, reflecting a lower tax rate of 24.5% in the quarter. PUMA’s half-year EBT also fell from € 146 million to € 102 million, with the tax rate improving to 28.0%.

Net Earnings / Earnings per share decline

PUMA’s consolidated net earnings retreated from € 27 million to € 18 million during the second quarter of 2013. Earnings per share fell from € 1.78 to € 1.17. Net earnings also declined during the first half of 2013 from € 101 million to € 68 million with EPS decreasing from € 6.72 to € 4.54.

Net Assets and Financial Position

Working Capital improves

As a result of PUMA’s continued emphasis on tight inventory management, inventories as of June 30th were 5.6% lower at € 635 million compared to last year. Group trade receivables were also 11.9% lower at € 513 million compared to last year. The Group’sworking capital has therefore developed positively from € 707 million to € 685 million at the end of June 2013.

Cashflow / Capex

PUMA’s Free Cashflow continued to improve during the first half of the year, moving from € -147 million to € -112 million. This is a result of lower payments for acquisitions and reduced Capex in 2013. The Free Cashflow (before acquisitions) came in at € -92 million compared to € -57 million for the same period in 2012.

Capex significantly declined from € 34 million to € 19 million, with lower investments in retail stores and other equipment.

Cash Position

As a consequence of the elements mentioned above, PUMA’s net cash position improved from € 236 million to € 291 million at the end of the second quarter.

General Matters

New Chief Operating Officer and Global Creative Director appointed

PUMA has appointed Andy Koehler as Chief Operating Officer (COO), who took up his position on June 1st. Andy, who succeeds former COO Klaus Bauer, is part of PUMA’s new management team built around PUMA’s new CEO Bjoern Gulden. Andy takes control of the Operations, Supply Chain Management, Logistics and IT functions.

To strengthen product and design, PUMA has created the new position of Global Creative Director as part of its Transformation Program and appointed to it Torsten Hochstetter. Torsten is responsible for designing, creating and developing the Sport Performance and Sport Lifestyle collections of the brand, touching on all product categories including Footwear, Apparel and Accessories. Torsten will work hands-on with all respective PUMA design teams worldwide.

Outlook for the Financial Year 2013

Full-year guidance remains unchanged from the first quarter

Following PUMA’s sales performance for the first half year 2013, Management continues to expect a low to mid single-digit decline in currency adjusted full-year net sales as well as pressure on the gross profit margin during the second half. As a consequence, and also based on continued OPEX improvements, Management reiterates its first quarter guidance and expects an increase in net earnings compared to 2012.

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.

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 Third Quarter Facts

• Currency adjusted sales increase by 6.4% to € 843 million
• Footwear sales return to growth
• OPEX increase due to Forever Faster marketing campaign
• EBIT of € 46 million
• Net Earnings of € 29 million
• Strategic equity investment made in Borussia Dortmund

2014 Nine Month Facts

• Currency adjusted sales increase by 2.4% to € 2.22 billion
• Slight gross profit margin decline to 47.2%
• OPEX increased by 3.7%
• EBIT of € 117 million
• EPS amounts to € 4.59
• Successful launch of worldwide Forever Faster brand campaign

Bjørn Gulden, Chief Executive Officer of PUMA SE: “In a good third quarter, PUMA achieved sales that were slightly better than expected. Footwear sales were up for the first time in seven quarters, and operating profits met our expectations. The launch of the Forever Faster marketing campaign was well received by both consumers and retailers. We told our consumers that PUMA is back and showed our retail partners that we deliver on our promises by investing in media campaigns. We feel that things are moving in the right direction, but as we have said all along: We know that the repositioning of PUMA and the turnaround of the business will take time as we need to continue to build confidence in the marketplace. I am convinced that our efforts have already translated into better products, better marketing and more efficient operations. In addition, we have now defined the key priorities which will mark the start of our IT infrastructure upgrade, laying the foundations for a fast, lean and efficient company in the future.”

Third Quarter 2014

Sales increase

PUMA’s 2014 third quarter sales performance was positive, as consolidated sales rose by 6.4% currency adjusted to € 843 million. This represents an increase of 3.7% in Euro terms, as continuing currency effects from various countries had a negative impact on sales.

Sales performance stronger in all regions and markets in Q3

Sales in the EMEA region increased by 4.4% currency adjusted to € 388 million. Performance improved in Western Europe, notably in Germany, where the new Borussia Dortmund jerseys were well received, as well as Switzerland and France, as sales of Teamsport and Lifestyle products rose.

Sales increased by 6.3% currency adjusted to € 265 million in the Americas, as North America continued to benefit from improved wholesale business, including key account initiatives like the PUMA Labs at Foot Locker. Sales in Latin America also rose, supported by a strong Teamsport business within the region.

Asia/Pacific sales increased by 10.7% currency adjusted to € 191 million due to growth in all key markets, including India, China, Korea and Japan. This growth was supported by the successful start of the Forever Faster brand campaign, the positive reception of PUMA’s new Arsenal jerseys and a strong Accessories business.

All product segments positive

Third quarter Footwear sales rose by 2.0% currency adjusted to € 374 million as Teamsport sales, particularly the PUMA evoSPEED boot, continued to improve.

PUMA’s third quarter Apparel sales rose by 11.4% currency adjusted to € 323 million, supported by strong demand for our Teamsport products, especially Arsenal jerseys and kit.

Accessories sales also improved by 7.5% currency adjusted to € 147 million due to continued demand for socks and bodywear. However, Golf equipment sales declined in the quarter as the golfing environment remained very weak.

Gross profit margin lower

PUMA’s gross profit margin declined from 47.1% to 46.3% for the third quarter of 2014 on the back of adverse currency impacts as well as shifts within the product mix which influenced the margin negatively. In addition, stronger sales in our distribution business within Latin America, particularly in Footwear, led to a decline in the Footwear margin from 44.4% to 41.9%. Apparel margin decreased slightly from 49.9% to 49.6%. However, the margin for Accessories improved from 48.6% to 50.3%.

OPEX increased

PUMA’s operating expenditures increased as expected in the third quarter, from € 309 million to € 349 million, due to the higher marketing expenditures associated with the Arsenal partnership and the launch of the Forever Faster brand campaign ahead of the back-to-school season.

Operating Result (EBIT) decreased

The decline in PUMA’s operating result (EBIT) from € 80 million to € 46 million in the third quarter of 2014 is mainly due to significantly higher marketing expenditures within the OPEX.

Financial Result

The financial result improved from € -1.5 million to € -0.7 million in the third quarter. The result remained negative due mainly to currency conversion impacts.

Net earnings

PUMA’s consolidated net earnings declined from € 53 million to € 29 million. As a result, earnings per share decreased from € 3.53 to € 1.93 in the third quarter of the year.

Nine Months 2014

Currency adjusted sales rose by 2.4% for the first nine months of the year to € 2.2 billion. As currency volatility continued to have a negative impact in the third quarter, albeit to a lesser extent, nine month sales in Euro terms declined by 2.9%.<7p>

Regional performances positive

Currency adjusted sales in the EMEA region rose by 1.4% to € 981 million, thanks to improvements in the United Kingdom and throughout Eastern Europe, the Middle East and Africa.

Sales in the Americas increased by 3.5% currency adjusted to € 751 million, with sales growth evenly spread over North America and Latin America.

Asia/Pacific sales rose by 2.5% currency adjusted to € 490 million, with positive performances throughout the region except in Japan, where the business climate in the first half of the year prevented a better result.

Apparel and Accessories sales increased

In terms of product segments, Footwear sales declined by 4.4% currency adjusted to € 972 million in the first nine months of 2014. Sales in Apparel increased by 9.1% currency adjusted to € 810 million, and Accessories sales also rose by 6.9% currency adjusted to € 439 million.

PUMA’s Retail sales rose

PUMA’s own and operated retail sales for the first nine months of the year increased by 3.4% currency adjusted to € 432 million, equal to 19.5% of total sales, as comparable sales in our stores improved during the period.

Gross Profit Margin down slightly

PUMA’s nine month gross profit margin declined slightly to 47.2% due to negative impacts from currency/hedging. The decline in the Footwear gross profit margin from 44.9% to 42.9% was almost offset by increases in the Apparel margin, from 49.6% to 50.4%, and in the Accessories margin, from 50.2% to 50.7%.

OPEX increase for the first nine months of the year

PUMA’s operating expenditure increased due to increased marketing costs associated with the launch of the Forever Faster brand campaign and the Arsenal partnership. However, tight control was maintained on all other areas of expenditure. OPEX rose by 3.7% from € 911 million to € 944 million compared to the same period last year.

Operating Result (EBIT) lower

Continued currency weakness in a number of countries had a negative impact on sales and gross profit. In addition, marketing spending increased due to our Forever Faster Campaign and new assets like Arsenal. As a result, PUMA’s EBIT declined as expected from € 190 million to € 117 million for the first nine months of the year, equivalent to 5.3% of sales.

Improved Financial Result

PUMA’s financial result improved from € -9.5 million to € -5.2 million. The negative result was caused mainly by the impact of foreign currency fluctuations.

Net Earnings / Earnings per share decline

Consolidated net earnings fell from € 121 million to € 69 million for the first nine months of 2014, with earnings per share declining from € 8.07 to € 4.59.

Net Assets and Financial Position

Focus on Working Capital continues

PUMA retained its focus on working capital management in the third quarter. As a result, Inventories were broadly flat at € 573 million and trade receivables increased by 4.6% to € 547 million, in line with the sales growth.

Cashflow / Capex

PUMA’s Free Cashflow (before acquisitions) moved from € -75 million to € -91 million for the first nine months of 2014, due to lower Earnings but supported by a much improved working capital position.

Capital expenditure rose from € 34 million to € 48 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 September 2014 declined slightly from € 246 million to € 231 million, also impacted by the payment for a 5.0% equity stake in Borussia Dortmund.

Brand Update

In September, PUMA participated in the capital increase of its strategic partner Borussia Dortmund GmbH & Co. KGaA (BVB) by acquiring 4,600,000 shares of the club, representing 5.0% of the voting rights. As Borussia Dortmund’s technical supplier since July 2012, we look forward to continuing our successful partnership with BVB as its close partner and shareholder. As one of the top clubs in Germany and Europe, Borussia Dortmund is a perfect fit for PUMA, increasing our brand awareness on a national and international level.

In addition to Borussia Dortmund, PUMA also added top English Premier League club Arsenal FC to its list of Teamsport partners at the start of the quarter. Our sales of replica jerseys, fanwear and associated accessories have been very satisfying since the new kits were launched in July.

In Motorsports, the PUMA partnered Mercedes AMG Petronas F1 team showed that they are truly Forever Faster, sealing the 2014 Constructor’s Championship with 3 races to go and thereby confirming their status as the fastest team in the world’s fastest sport. It has been a superb season for the team, with Lewis Hamilton and Nico Rosberg dominating the sport. PUMA has also extended its partnership with BMW Motorsport as the Official Supplier of Team and Racewear for all BMW Motorsport racing operations. With a relationship dating back to 2004 when PUMA first partnered the BMW Williams Formula One team, BMW Motorsport is PUMA’s longest standing partner in Motorsport and remains a core part of our Sports Marketing portfolio.

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 third 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, August saw the launch of the biggest marketing campaign in PUMA’s history, which marked the start of our repositioning as a true Sports Brand to our consumers and retail partners. The objective of the campaign was to demonstrate that PUMA is back in sports and that our brand has great assets and a distinctive attitude: Brave, confident, determined, and joyful. We achieved this objective as our campaign reached our consumers in 35 countries, generating 1 billion TV impressions in our target group as well as 31 million online views. The market surveys showed a very positive consumer reception. 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 make us very confident that we are heading in the right direction. With the continued positive feedback received for our Autumn/Winter 2015 collection, we are positive that we are on the right path.

In order to improve the quality of our revenues and distribution, we have developed 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. Our most prominent example is currently the PUMA Lab at Foot Locker, which we launched in Feb 2014 and has developed very positively as we have expanded our presence in the US throughout the year. The success of the PUMA Lab has not only improved our business with Foot Locker 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. With the finalization of the relocation of our Global and European Retail Organization from Oensingen, Switzerland, to our Headquarters in Herzogenaurach as of September 30th, we finalized the last out of our three major consolidation projects in 2014. This relocation followed the closure of our PUMA Village Development Center in Vietnam as of May 2nd and the relocation of our Lifestyle Business Unit from London to our Headquarters in Herzogenaurach as of May 31st.

Going forward, our strategic priorities will be complemented with a further objective: the upgrade of our current IT infrastructure to match the industry’s best practice benchmark. The process and system due diligence of our new COO revealed significant improvement potential in our IT and process landscape and we have now defined the key priorities which will mark the start of our IT infrastructure upgrade. We are very confident that our investment in these areas will lay the foundations for a lean and efficient company in the future.

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 as well as start investing in IT infrastructure, while maintaining tight control on other operating expenditures.

Given PUMA’s results through the first nine months of the year, we now expect a low single digit increase in currency adjusted net sales (previously flat) and a stable gross profit margin (previously slight increase) for the full year. As planned, OPEX will increase significantly based on increased Marketing investments throughout 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; we reiterate that the continued volatile currency movements will have a negative impact of around 50 basis points on the EBIT and Net Earnings margin for the year.

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.

NEW STRATEGIC DIRECTION “FOREVER FASTER” SUCCESSFULLY LAUNCHED

2014 Fourth Quarter Facts

• Consolidated sales grow to € 751 million, a currency adjusted increase of 6.3%
• Positive trend in Footwear continues in Q4, up 4.3% currency adjusted
• Improvement of gross profit margin from 43.2% to 45.0%
• OPEX increase mainly due to “Forever Faster” marketing campaign
• EBIT before special items improves to € 11 million compared to € 1 million in Q4 2013
• Strong rise of net earnings due to special items booked in Q4 prior year
• Rihanna announced as new PUMA Brand Ambassador

2014 Full Year Facts

• PUMA’s full-year consolidated net sales increase by 3.3% currency adjusted to around
  € 3 billion
• Slight improvement of gross profit margin to 46.6% despite adverse currency fluctuations
• OPEX rise as planned due to “Forever Faster” marketing campaign as well as new sponsoring contracts
• EBIT reaches € 128 million
• Net earnings (2014: € 64.1 million; PY: € 5.3 million) and EPS (2014: € 4.29; PY:
  € 0.36) improved strongly; no special items booked in 2014

Bjørn Gulden, Chief Executive Officer of PUMA SE: “The fourth quarter developed as we had hoped, with a solid increase in sales and even stronger improvement in EBIT and net earnings. We are especially pleased to see that we again, for the second quarter in a row, had growth in our footwear sales. Our full-year results are also in line with expectations. We stopped the decline in sales and made progress with all our strategic priorities. We now have a clear positioning, which will be strengthened through increased investment into marketing and a clear use and celebration of our assets. We are further focusing on communicating stories clearly. We have made strides in improving our product and are working with our retailers to further improve the quality of our distribution. Additionally, we have started to improve our IT foundation and operations, to ensure a faster, leaner, and more efficient set up in the coming years. In 2015, we will continue to work towards our mission of becoming the Fastest Sports Brand in the world while further improving our business along all strategic priorities. The addition of Rihanna, as a Brand Ambassador and as one of our creative directors, is a commitment to our increased focus on the female consumer segment, as we truly believe that the "future is female". We know that the turnaround will take time but feel that 2014 was a turning point. We expect 2015 to confirm that we are moving in the right direction.”

FOURTH QUARTER 2014

Strong fourth quarter performance

In comparison with last year, consolidated sales in the fourth quarter of 2014 recovered and rose from € 698.3 million to € 750.8 million, which represents a currency adjusted increase of 6.3%. This was driven mainly by a stronger demand in the Americas as well as a considerable upwards trend in Accessories and further recovery in footwear sales.

In the EMEA region, sales increased slightly by 0.6% currency adjusted to € 224.8 million, as economic conditions in some continental European countries remained challenging, while the UK enjoyed a very solid performance.

Revenues in the Americas region increased strongly by 15.0% currency adjusted to € 319.3 million. Solid performances in the USA and Canada and strong growth rates in Argentina, Brazil and Mexico drove this performance.

Sales in the Asia/Pacific region rose slightly by 0.7% currency adjusted to € 206.7 million. While China and India grew, Korea and Japan performed below last year’s levels.

PUMA’s Footwear sales in the fourth quarter improved, up for the second quarter in a row, by 4.3% currency adjusted to € 310.7 million. Apparel sales improved by 3.6% currency adjusted to € 293.0 million, while Accessories saw its sales increase sharply, up 17.1% currency adjusted to € 147.1 million despite adverse market developments in the Golf category.

PUMA’s gross profit margin increased from 43.2% to 45.0% in the fourth quarter of 2014. Lower price reductions supported by a better product mix in the quarter helped to improve the margin in Footwear and Apparel. Footwear gross profit margin increased from 39.5% to 41.6%. Apparel margin rose from 44.7% to 47.1%, while the margin for Accessories decreased slightly from 48.4% to 47.8% impacted by the current weakness within the Golf business.

After four consecutive quarters of decline, operating expenditures in the fourth quarter of 2014 increased as a result of the intensified marketing activities of PUMA. As a consequence – although PUMA maintained its focus on a strict cost management - total OPEX rose by 8.6% from € 306.2 million to € 332.4 million during the quarter. Combined with the increase in sales and the improved gross profit margin, this led to the higher EBIT (before special items) of € 10.6 million. As no special items were recorded in the fourth quarter of 2014 (prior year: € 129.0 million), the Operating Result (EBIT) increased significantly. Earnings per share in the fourth quarter of 2014 came in at € -0.30.

FULL YEAR 2014

PUMA’s full-year sales increased 3.3% currency adjusted

Consolidated sales were in line with the guidance for 2014 and increased by 3.3% currency adjusted to around € 3.0 billion, which corresponds to a slight decline of 0.4% in Euro terms, reflecting the currencies headwind registered throughout the year. All regions contributed to growth, posting currency adjusted growth rates in the year.

Sales in the EMEA region increased by 1.3% currency adjusted to € 1.2 billion, where strong performance in the United Kingdom more than offset weaker French and Italian markets.

In the Americas, sales improved significantly by 6.7% currency adjusted to € 1.1 billion thanks to a strong demand particularly from the U.S., Canada, Argentina and Mexico.

In Asia/Pacific, sales rose by 1.9% currency adjusted to € 696 million, as a strong demand from India and China outbalanced a decline in Japan, which was mostly related to the weaker Golf category.

In 2014, Footwear sales decreased due to a weaker first half by 2.4% currency adjusted to € 1.3 billion, while the second half showed growth in the segment. Sales in Apparel rose by 7.6% currency adjusted to € 1.1 billion. Sales in Accessories continued to improve and showed a significant increase of 9.3% currency adjusted to € 586 million.

Sales growth continued in PUMA’s Retail Business

In line with PUMA’s strategy, PUMA continued to optimize its retail network in 2014. While the company continued to open stores with a particular focus on profitable new locations in growth markets, it carried on its program of selective closures of unprofitable stores at the same time. As such, comparable store sales were positive in the year and full-year retail sales rose by 3.9% currency adjusted to € 618 million in 2014, equaling 20.8% of total sales.

Slightly improved Gross Profit Margin

PUMA’s full-year gross profit margin increased slightly from 46.5% to 46.6%, driven by positive margin developments in Apparel and Accessories that were able to more than offset the decline in Footwear. Footwear margin for the full-year stood at 42.6% versus 43.7% in the previous year. Margin in Apparel increased significantly from 48.3% to 49.5%. Accessories gross profit margin also increased from 49.8% to 50.0%.

Marketing efforts drive OPEX

Due to the increased marketing expenses for the „Forever Faster“ brand campaign, the football world cup in Brazil as well as the sponsoring of additional football clubs and athletes, the full-year OPEX increased by 4.9% from € 1,216.9 million to € 1,276.8 million. At the same time, savings were realized in other areas in line with the ongoing strict cost management.

Operating Result (EBIT) before special items in line with guidance

As a consequence of the effects outlined above, full-year EBIT before special items declined from € 191.4 million to € 128.0 million. This corresponds to a 4.3% margin on net sales.

No Special Items in 2014

PUMA’s 2014 results were not affected by any special items, while in the previous year, PUMA recorded € 129.0 million.

Operating Result (EBIT) after special items increased

As a result, PUMA’s EBIT after special items for the full year improved from € 62.5 million to € 128.0 million, equivalent to an increase from 2.1% to 4.3% as a percentage of sales.

Financial Result improved

For the full year, PUMA’s financial result improved from € -8.7 million to € -6.2 million.

Net Earnings / Earnings per share increase

Full-year consolidated net earnings rose from € 5.3 million in 2013 to € 64.1 million in 2014, with earnings per share increasing from € 0.36 to € 4.29.Sales growth continued in PUMA’s Retail BusinessSales growth continued in PUMA’s Retail Business

NET ASSETS AND FINANCIAL POSITION

Working Capital position continues to improve

The Group’s significantly declined by 13.8% from € 528.4 million to € 455.7 million.Inventories increased from € 521.3 million to € 571.5 million at the end of 2014, while trade receivables rose from € 423.4 million to € 449.2 million. As per the balance-sheet date, trade liabilities increased from € 373.1 million to € 515.2 million as a result of higher inventories and because of timing of payments.

Cashflow / Capex

PUMA’s Free Cashflow improved from € 29.2 million at the end of 2013 to € 39.3 million at the end of 2014. This was mainly due to lower Working Capital requirements and was achieved despite an increase in CAPEX.

Cash Position improved

PUMA’s year end Cash Position improved to € 401.5 million compared to last year’s € 390.1 million.

Dividend

The Administrative Board will propose a stable dividend of € 0.50 per share for the financial year 2014 at the Annual General Meeting on 6th May 2015.

STRATEGY UPDATE

To be the Fastest Sports Brand in the world

In 2013, Bjørn Gulden (CEO) introduced PUMA’s new mission statement: To be the Fastest Sports Brand in the world. The company’s mission not only reflects PUMA’s new brand positioning of being Forever Faster, it also serves as the guiding principle for the company expressed through all of its actions and decisions. Our objective is to be fast in reacting to new trends, fast in bringing new innovations to the market, fast in decision-making and fast in solving problems for our partners.

Strategic priorities

Our strategy encompasses five strategic priorities: the repositioning of PUMA as the World’s Fastest Sports Brand, the improvement of our product engine, the optimization of our distribution quality, increasing the speed within our organization and infrastructure, and renewing our IT infrastructure. In 2014, we continued to make further progress on all our key strategic priorities to ensure that the year marks the start of a turnaround.

In terms of our brand repositioning, August 2014 saw the successful launch of our worldwide Forever Faster brand campaign – the biggest marketing campaign in PUMA’s history. This marked the start of our repositioning as a true sports brand to our consumers and retail partners. The objective of the campaign is to demonstrate that PUMA is back in sports and that our brand has great assets and a distinctive attitude: Brave, confident, determined, and joyful. We achieved this goal by focusing our campaign on customers in 35 countries. In the first three months after the start, our advertising generated 1 billion TV impressions in our target group as well as 31 million online views. The market surveys showed a very positive consumer reception. The launch of this campaign marked the start of a long-term marketing strategy, which will be continued in 2015 and run through the Rio de Janeiro Olympic Games in 2016 and beyond.

To improve our product engine, we initiated key projects to enhance our product designs, develop more innovative technologies and increase the commercial appeal of our product range. The first results have already been implemented for the 2015 collections, and the feedback from our retail partners make us very confident that we are heading in the right direction.

In order to improve the quality of our revenues and distribution, we have developed joint product and marketing programs with our key retailers to showcase our brand in the right retail environment and drive sell-through with our partners. In February 2014, together with our partner Foot Locker USA, we introduced the jointly developed retail concept "PUMA Lab" and successfully rolled it out in the US market. The success of the PUMA Lab has not only improved our business with Foot Locker USA but also generated a positive spill-over effect onto other key retailers in the US marketplace – both with performance and lifestyle accounts. In 2015, we will continue to foster collaborations and launch further product and marketing programs with our most important key accounts in every region.

In 2014, we also continued to optimize our organizational structure and setup by making them leaner and faster. With the finalization of the relocation of our Global and European Retail Organization from Oensingen, Switzerland, to our Headquarters in Herzogenaurach as of September 30th, we completed the last out of our three major consolidation projects in 2014. This relocation followed the closure of our PUMA Village Development Center in Vietnam in May and the relocation of our Lifestyle Business Unit from London to our Headquarters in Herzogenaurach in June. In 2015, we will be focusing on standardizing and optimizing processes between PUMA and its partners. The key projects in this area are the implementation of a sourcing organization to manage global order and invoice flows and the conceptual design of a European trading company to optimize regional flows of goods.

Another strategic priority is the renewal and expansion of our IT infrastructure to create a basis for more extensive optimization measures. In 2015, we will focus on three areas: optimize our basic IT infrastructure, start the implementation of a standard ERP system to support sourcing and trading functions, and set-up platforms to improve the design, development and planning processes. We are very confident that our investments in these areas will lay the foundation for a lean and efficient company in the future.

BRAND AND MARKETING UPDATE

At the end of 2014, we added global cultural icon Rihanna to our roster. Through this new multi-year partnership, Rihanna will serve as a global brand ambassador. She will play a key role in PUMA’s brand campaign Forever Faster, featuring along PUMA’s world-class athletes such as Usain Bolt and Sergio Aguero. From Spring/ Summer 2016 on, she will serve as one of the Creative Directors for PUMA, specially focusing on Women. Rihanna will directly influence our Women’s collections with her fresh, forward thinking and non-traditional approach to sports, fitness and lifestyle. This marks the start of a renewed focus on Women for the PUMA brand. In 2015, we will further underscore our increased focus on female consumers by launching an extended training range, starting with the Pulse XT, which will be endorsed by Rihanna.

Our Autumn/Winter 2014 collection in Lifestyle saw a star reborn, when we reissued the Becker OG, the classic mid top shoe that 17-year old Boris Becker wore during his famous and groundbreaking Wimbledon win in 1985. A timeless silhouette originally made for the tennis court, the Becker OG merges the best of PUMA’s performance heritage and design language.

In Motorsports, Lewis Hamilton of the PUMA-partnered Mercedes AMG Petronas F1 team clinched his second drivers' World Championship ahead of his teammate Nico Rosberg in the season-ending Abu Dhabi Grand Prix. Hamilton wore the PUMA F1 Pro SLW, weighing only 99 grams. It is the lightest Formula 1 shoe that currently exists.

The year 2015 has started very positively for PUMA as the 2015 Africa Cup of Nations proved to be a fantastic stage for our football products with Ivory Coast beating Ghana 9:8 in a thrilling penalty shootout, with both teams being outfitted by PUMA. Led by their captain and PUMA star player Yaya Touré, the “Elephants” put on a brilliant performance to claim their second Africa Cup of Nations title after 1992. On the pitch in Equatorial Guinea, Touré sported the next generation of our evoPOWER football boot, designed to bring Power and Accuracy to a higher level. The innovative shoe was launched at the beginning of this year through a “Head to Head” campaign featuring PUMA key assets Mario Balotelli and Cesc Fàbregas.

In February 2015, a further innovation was launched in our running category. Our most innovative running footwear technology to date, introduced by the World’s Fastest Man, Usain Bolt on New York City’s Times Square: IGNITE. Developed together with BASF over multiple years, IGNITE is revolutionary to the business. PUMA’s best ever, PU foam provides the highest return of energy we have ever created, step-in comfort and long-lasting durability with ForEverFoam. In subsequent seasons, additional styles will be introduced and the IGNITE line will be expanded further within our Running and Training category. In the second half of 2015, we will continue our training and Ignite story with IGNITE XT trainer.

OUTLOOK FOR THE FINANCIAL YEAR 2015

After the successful launch of PUMA’s Forever Faster campaign in autumn 2014, PUMA will continue its marketing investments in order to reposition PUMA as the fastest sports brand of the world. The objective of PUMA’s brand repositioning is to increase brand heat and further replace lower tier distribution with higher tier distribution in order to improve sales quality and sell-through.

Together with improvements in the product offering, PUMA expects an increase of its currency-adjusted net sales in the medium single-digit range for the full year 2015, with sales in the first half expected to be flat and growth occurring in the second half. The gross profit margin is anticipated to improve slightly based on lower discounts and a favorable product mix.

For 2015, PUMA is planning further strong investments in the “Forever Faster” marketing campaign as well as in the upgrade of our current IT. We are very confident that our investment in IT will lay the foundation for a lean and efficient company in the future. As a consequence, PUMA’s OPEX will increase while management will continue to put a strong emphasis on strict control of other operating costs.

The recent adverse developments of foreign exchange rates, particularly the strengthening of the US-Dollar versus nearly all other currencies, could lead to a significant negative impact on the reported gross profit margin and the overall reported EBIT and net earnings of the PUMA group.

Because of these negative currency developments, PUMA has already taken and will continue to take countermeasures, which should support a slight increase in reported EBIT and net earnings.

Last year, PUMA has successfully taken the first steps to re-establish the brand in the market place. 2015 will be the year to further enhance and reinforce this brand positioning and to take a further step in getting PUMA back to a path of profitable and sustainable growth.

NOTES

Media Relations:

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

Investor Relations

Beate Gabriel – Finance - PUMA SE - +49 9132 81 2375 – beate.gabriel@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.