The 121-page document covers the reporting period 2007/2008 and has exclusively been published online for environmental reasons. It details PUMA’s progress to enhance working and social standards in its supply chain, build capacity at its suppliers’ factories, broaden its range of sustainable products and reduce the company’s environmental footprint through the PUMAVision category puma.safe. It furthermore outlines PUMA’s activities in supporting artists and creative organizations through the category puma.creative and its initiatives to support global peace through puma.peace.

Download the full report here.

“Our 2007/2008 PUMAVision Sustainability Report is a testament to the fact that we at PUMA do not simply talk about sustainable development, we take action,” said Jochen Zeitz, Chairman and CEO of PUMA. “We are proud of our successes over the years and of our commitment to sustainability and the highest ethical standards, but realize that when it comes to corporate responsibility, there is and will always be room for improvement. Now, more than ever, we are deepening our commitments and dedicating ourselves to a strategy that sees the ‘whole’ as a sum of its parts—our PUMAVision. As we work towards a safer, more peaceful, and more creative world, we will continue to expand our outreach as corporate global citizens beyond the boundaries of business, not only for the benefit of our stakeholders, but for all.”

Highlights of the visually appealing document include:

• A portrait of the concept PUMAVision
• A transparent description of PUMA’s response to the challenges it faces in its supply chain operations, capacity building projects and brand collaboration initiatives
• The expansion of PUMA’s range of sustainable products through Fair Trade footballs and apparel from “Cotton Made in Africa”
• A detailed account of PUMA’s numerous initiatives to protect the environment, including the progress on reaching targets of a 25% reduction of energy and water consumption as well as waste creation for offices by 2010 and decreasing its carbon footprint
• An outline of PUMA’s worldwide activities in cooperation with the charity organization “Peace One Day” to raise awareness for global peace
• An account of its sponsorship of the art exhibition 30 Americans to support the work of 31 African-American artists
• A recap of PUMA’ numerous projects on the African continent

The report has been certified by TÜV Rheinland, which “is confident that PUMA AG operates a meaningful and adequate system to collect, measure, control and steer their sustainability activities and that the PUMA 2007/2008 Sustainability Report presents information and facts that give a realistic impression on the sustainability performance of the company.”

The Global Reporting Initiative has reconfirmed an A+ rating for the document.

PUMA’s endeavours to enhance its social and environmental standards are ongoing. The Sportlifestyle company endorses the campaign “Seal the Deal!” led by the United Nations. This campaign aims at strengthening political will and public support for reaching a comprehensive global climate agreement at the Climate Change Conference in Copenhagen, Denmark, in December 2009 to help prevent global warming and further climate change. As a participant in the Carbon Disclosure Project, PUMA is actively working on reducing its direct and indirect climate gas emissions.

PUMA is committed to working in ways that contribute to the world by supporting creativity, sustainability and peace, and by staying true to the values of being Fair, Honest, Positive and Creative in decisions made and actions taken. The foundation for our activities is PUMAVision—a concept that guides our work with its three core programs, puma.creative, puma.safe and puma.peace.

Highlights Third Quarter:

• Consolidated sales at € 673 million, a decline of 5.5% versus last year’s third quarter
• Gross profit margin at 51.9%, up from 50% in the second quarter
• Total operating expenses 2.5% below last year’s level as a result of ongoing cost savings program
• Operating result at € 98 million, reflecting a decrease of 21.6% in the quarter
• EPS at € 4.50 after € 5.81 last year
• Continued strong reduction in inventories and improvement in net cash position

Highlights First Nine Months:

• Global brand sales above € 2 billion
• Consolidated sales slightly up in Euro terms and 2% down currency-adjusted
• Gross profit margin remains above 51%
• Operating result before special items at € 275 million
• EPS before restructuring at € 13.01 after € 14.55 last year

Outlook 2009:

• The ongoing reengineering and restructuring program is expected to continue until the end of 2009
• The strong emphasis on improving working capital and focus on cash generating activities seen in the first three quarters will continue as planned

Jochen Zeitz, CEO: “The business environment has continued to be as challenging as we had expected, which resulted in a decrease in sales and profits. Despite this most difficult market, we generated a profit in all three quarters so far and we expect to be profitable in Q4 again. We hope to see first signs of an improving business environment in the run up to the Football World Cup in South Africa, where PUMA through its strong ties with African Football has a home field advantage.”

Sales and Earnings Development

Global Brand Sales

PUMA’s brand sales in the third quarter, which include consolidated and license sales, decreased by 7.6% in Euro terms, or by 8.3% currency-adjusted, to € 719.6 million.

After nine months, global brand sales declined currency-neutral 4.8%. In Euro terms, sales decreased by 2.6% to € 2,093.8 million. On a currency-neutral basis, Footwear sales were down by 5.3% to € 1,113.7 million and Apparel sales by 6.2% to € 719.1 million. Accessories sales increased by 1.3% to € 260.9 million.

Consolidated Sales

Consolidated sales in the third quarter decreased by 6.3% currency-neutral or by 5.5% in Euro terms to € 673.4 million. On a currency-neutral basis, Footwear sales were down by 13.0% at € 358.7 million, and Apparel sales decreased by 5.2% to € 238.1 million. Due to first time consolidations, Accessories sales improved significantly by 38.5% to € 76.6 million.

After the first nine months, consolidated sales were down by 2.0% on a currency-neutral basis but increased by 0.4% in Euro terms to € 1,971.1 million. Sales in EMEA and Asia/Pacific were below last year’s level. Sales in the Americas region, however, increased despite the challenging market environment. Footwear sales were down by 5.6% currency-neutral at € 1,085.8 million. Apparel sales decreased by 6.3% to € 664.3 million on high comparables last year after the Football Euro 2008 generated strong replica sales. Accessories sales increased significantly by 45.3% to € 221.0 million.

Gross Profit Margin

In the third quarter, the gross profit margin decreased from 53.6% last year to 51.9%. This decline mainly derives from further inventory reduction programs and changes in the product and regional mix, as well as higher raw material costs. After the first nine months, PUMA achieved a gross profit margin of 51.4% versus 53.2% last year. Footwear reported 50.2% compared to 53.1%, Apparel 52.2% versus 53.3% and Accessories increased to 54.8% from 53.3% last year.

Operating Expenses

Operating expenses decreased by 2.5% to € 256.9 million in the third quarter. During the first nine months, operating expenses remained at last year’s level of € 753.1 million, representing a cost ratio of 38.2% versus last year’s 38.3%.

Marketing/Retail expenses decreased by 4.7% to € 374.9 million mainly as a result of last year’s higher spending level in relation to the Olympic Games and Football Euro Cup. The cost ratio declined from 20.0% to 19.0% of sales. Other selling expenses increased by 10.4% to € 240.3 million, or from 11.1% to 12.2% of sales. Product development and design increased from 13.6% to € 43.4 million, or as a percentage of sales from 1.9% to 2.2%. Other general and administration expenses were down by 7.2% at € 94.6 million, representing 4.8% of sales versus 5.2% last year. Depreciation increased by 10.4% to € 44.7 million due to full year effects from last year’s retail expansion.

Operating Result before Special Items

Amid lower sales combined with the softened margin in the quarter, the operating result came in at € 98.0 million in the quarter versus € 125.0 million last year. As a percentage of sales, it fell to 14.5% from 17.5% last year.

After nine months, the operating result was down by 12.2% at € 275.1 million from € 313.2 million, while the operating margin was still double-digit with 14.0% versus 16.0% last year.

Special Items – Reengineering and Restructuring Program

The reengineering and restructuring program, which resulted in a one-time charge of € 110 million in the first quarter, will continue as planned and should be largely finalized by the end of 2009. The program will provide for a more efficient, leaner and faster business platform to adjust to the current market conditions.

Considering the restructuring charge, EBIT for the first nine months totaled € 165.1 million compared to € 313.2 million last year.

Financial Result

Due to lower interest rates and the accumulation of interest on purchase price liabilities from acquisitions, the financial result in the third quarter was at € -1.9 million versus € -0.5 million in last year’s quarter. After nine months the financial result stood at € -5.6 million compared to a slightly positive € 0.5 million last year.

Earnings

The company’s pre-tax profit (EBT) was € 96.0 million in the third quarter versus € 124.5 million last year. Net earnings totaled € 67.9 million versus € 89.0 million, a decline of 23.6%. This translated into earnings per share of € 4.50 compared to € 5.81.

Before restructuring costs, EBT came in at € 269.4 million versus € 313.7 million for the first nine months and net earnings totaled € 196.3 million versus € 224.7 million, representing a decline of 12.6%. Earnings per share were at € 13.01 compared to € 14.55. The operational tax ratio was calculated at 27.9% versus last year’s 28.7%.

Taking the restructuring costs into account, EBT was € 159.4 million and net earnings were € 112.0 million with earnings per share at € 7.42 versus € 14.55 last year, a decline of 49.0%.

Regional Development

In the EMEA region, third quarter sales decreased by 3.1% currency-neutral and totaled € 366.4 million in the third quarter. While the sales performance in Western Europe was impacted by promotional sales due to the current market situation, the EEMEA region managed to stay on prior year level. After nine months, sales were down by 2.6% to € 1,020.8 million, representing 51.8% of consolidated sales. Gross profit margin was at 53.2% compared to 55.2% last year.

Sales in the Americas were down by 11.2% currency-adjusted at € 165.4 million in the third quarter. After nine months, however, sales rose by 1.6% to € 512.1 million. The region now accounts for 26.0% of consolidated sales. Gross profit margin was at 47.9% compared to 48.9% last year.

In the US market, sales decreased by 11.3% to $ 129.5 million in the third quarter and by 1.4% to $ 400.9 million after nine months. For the Latin American region this quarter was characterized by the convergence of increased import restrictions and other conditions which had negative impacts on sales performance.

In the Asia/Pacific region, sales fell by 8.3% in the third quarter currency-neutral, but increased in Euro terms by 1.2% to € 141.6 million. After nine months, sales were down by 4.7% currency-neutral but increased by 8.5% in Euro terms to € 438.2 million, representing 22.2% of consolidated sales. Gross profit margin reached 51.1% versus 53.1% last year.

Net Assets and Financial Position

Equity

As of September 30, 2009, total assets were up by 7.9% to € 2,057.5 million. Based on the higher balance sheet total, the equity ratio stood at 59.1% after 62.3% in the previous year.

Working Capital

PUMA adhered to its plan to significantly reduce inventory, which improved by 17.5% to € 356.4 million. Accounts receivable were slightly below last year’s level at € 530.7 million. Working capital improved to € 523.3 million (ex acquisition € 507.6 million) from € 599.6 million last year – showing again a significant enhancement compared to previous quarters and thus underpinning our strong focus on managing working capital.

Capex/Cashflow

In the first nine months, the company invested € 40.8 million versus € 79.1 million last year. The reduction in capital expenditure together with a solid improvement in working capital led to a strong increase in PUMA’s free cashflow of € 145.1 million from € 17.2 million, showing a strong enhancement compared to last year. An outflow of € 75.8 million versus € 24.9 million last year is related to acquisitions. Taking these acquisitions into account, the free cashflow amounted to € 69.4 million versus an outflow of € 7.7 million last year.

Cash Position

Given the strong focus on cash management, total cash at the end of September rose from € 297.3 million to € 376.9 million and bank debts declined from € 61.1 million to € 37.4 million this year. As a result, net cash was up from € 236.2 million to € 339.5 million this year, a respectable increase of 43.7%.

Outlook 2009 – Market environment remains challenging in Q4

The market and consumer environment is expected to remain challenging. The reengineering and restructuring program is planned to be finalized by the end of the year and will generate improvements in efficiency and cost savings in the future.

Highlights Fourth Quarter:

• Consolidated sales down 10.1% currency-adjusted
• Gross profit margin at 51.0%, up 430 basis points versus last year
• Operating result up 21.3% to € 45 million
• Special items of € 18 million impact net earnings
• EPS up 80% at € 1.08 after € 0.60 last year

Highlights January – December:

• Consolidated sales decreased 3.7% currency-adjusted
• Gross profit margin at 51.3% versus 51.8% last year
• Operating result at € 320 million or 13.0% of sales
• EBIT including special items at € 192 million
• EPS at € 8.50 versus € 15.15 last year
• Free cashflow before acquisitions at €256 million up 130% and 2nd best result in history

Outlook 2010:

• Despite a continuously tense global economy the currency-adjusted sales volume in 2010 is expected to at least reach last year’s level.
• A comparable gross profit margin will be targeted in spite of a lower currency hedging position and higher proportion of team sport product sales.

Increased marketing expenses are to be expected during the World Cup year, whereas the 2009 cost reduction program should provide for cost savings and increases in efficiency, which should at least compensate the one-off expenses.

Jochen Zeitz, CEO: “Despite the global financial crisis and only a few major sports events, PUMA remained firm in a difficult market environment, posting an only moderate decline in annual sales along with the second best cashflow development in the history of the company. The comprehensive restructuring and reengineering program that we implemented during the year enabled us to become an even more efficient and focused company that is aligned to today’s economic realities. PUMA had an excellent and successful start into the football year by winning the African Cup of Nations with Egypt. We will turn the Football World Cup in South Africa into a home game and are determined to make use of and invest in all opportunities that offer further growth to strengthen the brand’s and company’s desirability in the long run.”

The Year 2009

As a result of the financial crisis and its impact on the global economy, 2009 proved to be very challenging for all market participants. Despite the global recession and only a few major sporting events, PUMA succeeded in standing its ground in the difficult market environment. The performance of Usain Bolt at the World Athletics Championships in Berlin, where he broke the 100m and 200m world records, was, among others, a particular highlight for the PUMA brand.

As early signs of the economic deceleration appeared, PUMA pro-actively implemented measures starting in Q4 of 2008. During 2009, management continued to install a comprehensive restructuring and re-engineering program to optimize the retail portfolio, the global organizational structure and operational processes. This resulted in one-off expenses in the amount of € 127.8 million

Currency-adjusted, global brand sales decreased by 6.4% to remain above € 2.6 billion. Currency-adjusted consolidated sales declined by only 3.7% to approximately € 2.5 billion. Despite the difficult market environment, the gross profit margin stood at a robust 51.3%, which means that PUMA continues to maintain its position at the upper echelon of the sporting goods industry. The operating profit before special items totaled € 320.2 million or 13.0% of sales, compared to 13.9% in the previous year. Including special items, earnings per share amounted to € 8.50 compared to € 15.15 in the previous year. Working capital decreased by 9.9% to € 397.8 million. This strongly supported the free cashflow before acquisitions, which more than doubled from € 110.7 million to € 255.8 million, yielding the second best result in the company’s history.

The price of the PUMA share stood at € 231.84 at the end of the year and increased by 65.2% year-on-year, which resulted in a market capitalization of approximately € 3.5 billion.

Sales and Earnings Development 4th Quarter 2009

Consolidated sales decreased currency-adjusted as expected by 10.1% in the fourth quarter 2009 and totaled € 489.5 million. In the fourth quarter which traditionally is the weakest, sales were effected by the significantly reduced inventory leading to less close out sales.

Currency adjusted sales in EMEA were down 10.9%, Americas sales decreased 2.6% and Asia/Pacific 16.2%. Footwear sales decreased 16.8% and Apparel 10.9%. Sales in Accessories increased 39.4%, mainly from first time consolidation effects.

The gross profit margin increased to 51%, up 430 basis points from last year. All regions and product segments contributed positively.

While operating expenses decreased by 9.2% to € 209.7 million, the cost ratio increased to 42.8% versus 41.1% last year due to the lower sales basis in Q4 2009. Operating profit (before special items) improved by 21.3% from € 37.2 million to € 45.1 million or from 6.6% to 9.2% as a percentage of sales. Including special items, earnings per share were at € 1.08 compared to € 0.60 in the previous year.

Further cost saving potential has been identified, leading to additional € 17.8 million one-off expenses.

Sales and Earnings Development January-December 2009

Global Brand Sales

Worldwide PUMA brand sales, comprised of licensed and consolidated sales, dropped by 6.4% currency-adjusted to just above € 2.6 billion. In Euro terms, this corresponds to a 5.3% decrease.

Consolidated Sales

Currency-adjusted sales decreased by 3.7% to € 2,460.7 million in 2009 which corresponds to a 2.5% decrease in Euros.

The Footwear segment posted a decrease in currency-adjusted sales by 7.8% to € 1,327.8 million. The share in consolidated sales stood at 54.0%, compared to 56.8% in the previous year.

Currency-adjusted sales in the Apparel segment dropped by 7.4% to € 852.9 million, representing a 34.7% share in consolidated sales, compared to 35.6% in the previous year.

Currency-adjusted sales in the Accessories segment increased by 44.0% to € 280.1 million, which is primarily due to first time consolidation effects. The share in consolidated sales increased to 11.4%, compared to 7.6% in the previous year.

Gross Profit Margin

As a result of the promotional environment and a change in the regional mix, the gross profit margin decreased by 50 basis points to 51.3%, which is still in the upper echelon of the sporting goods industry. In absolute figures, the gross profit margin decreased by 3.4% from € 1,306.6 million to € 1,262.4 million

The gross profit margin for Footwear was 50.2%, compared to 51.7% in the previous year. The gross profit margin for Apparel increased from 51.9% to 52.1% while Accessories recorded a significant increase in the gross profit margin, rising from 51.7% to 54.3%.

Operating Expenses/Result

As a result of the cost reduction measures, operating expenses before special items decreased from € 982.0 million to € 962.8 million, or by 2.0%. As a percentage of sales, the cost ratio stood at 39.1%, compared to 38.9% in the previous year.

Within selling expenses, expenses relating to marketing/retail declined from € 528.6 million to € 494.1 million, corresponding to a cost ratio decrease from 20.9% to 20.1% of sales. However, previous year’s expenses include costs related to the Olympic Games and the 2008 European Football Championship.

Other selling expenses increased by 4.7% to € 309.8 million, or from 11.7% to 12.6% of sales. Expenses for product development and design increased from € 55.1 million to € 58.1 million, or from 2.2% to 2.4% of sales. Administration and general expenses decreased from € 102.4 million to € 100.9 million, with the cost ratio remaining unchanged at 4.1% of sales.

The total depreciation amounted to € 60.2 million, which reflects an increase of 7.7% compared to the previous year, mainly attributable to first time consolidation and full year effects of last year’s expansion of the company’s own retail operations.

Operating profit before special items was € 320.2 million, compared to € 350.4 million in the previous year. As a percentage of sales, this corresponds to an operating margin of 13.0%, compared to 13.9% last year.

Special Items – Reengineering and Restructuring Program

In light of the difficult market environment, PUMA implemented further measures in the first quarter of 2009 to ensure long-term and profitable growth. The management installed a rigorous reengineering and cost reduction program that will reduce the initially planned costs on an annual basis. The originally required one-off expenses of € 110 Mio have increased to € 127.8 million. The one-off expenses relate to the optimization of the retail store portfolio, the global organizational structure and the re-engineering of some key operational processes. Considering non-cash impacting depreciation, € 84.5 million of the one-off expenses will become cash relevant. The cost reduction program will help to further reduce the planned costs and provide for cost savings beyond our original target of up to € 150 million.

Including the special items, the operating profit (EBIT) amounted to € 192.4 million, or 7.8% of sales.

Financial Result

The financial result was € -8.3 million, compared to € 1.1 million in the previous year. Significantly lower interest rates and the higher interest portion relating to purchase price liabilities have had a negative impact on the financial result.

The financial result includes interest income in the amount of € 3.8 million (vs. € 11.9 million in the previous year), as well as interest expenses in the amount of € 6.6 million (previous year: € 6.7 million). The financial result also includes expenses relating to accumulated, long-term purchase price liabilities from corporate acquisitions in the amount of € 4.4 million (previous year: € 3.1 million), as well as expenses in the amount of € 1.1 million (previous year: € 1.0 million) stemming from the valuation of pension plans.

Earnings before Taxes

Earnings before taxes (EBT) decreased from € 326.4 million to € 184.1 million, or from 12.9% to 7.5% as a percentage of sales. This reduction is primarily due to the special items. Tax expenses decreased from € 94.8 million to € 58.2 million. The tax rate stood at 31.6%, up from 29.0% in the previous year. This was mainly attributable to the recognition of one-off expenses for tax purposes in the respective countries.

Net Earnings

Net earnings in the 2009 financial year amounted to € 128.2 million, compared to € 232.8 million last year. The net rate of return was 5.2%, compared to 9.2% in the previous year. Earnings per share and diluted earnings per share amounted to € 8.50, compared to € 15.15 in the previous year.

Regional Development

Currency-adjusted sales in the EMEA region declined by 4.0% to € 1,217.6 million. The share of the EMEA region in consolidated sales amounted to 49.5%, compared to 51.5% in the previous year.

By product segments, currency-adjusted Footwear sales decreased by 13.1%, and Apparel sales declined by 9.5%. As a result of the acquisition of a former licensee, Accessories sales nearly doubled with an increase of 98.7%.

The gross profit margin stood at 53.3%, compared to 53.5% in the previous year.

The Americas region posted an increase in currency-adjusted sales of 0.6% to € 665.2 million. The share in consolidated sales stood at 27.0%, compared to 25.8% in the previous year.

Currency-adjusted Footwear sales were up by 1.2%, and Apparel sales recorded a 0.1% increase. Accessories sales decreased by 4.3%.

The gross profit margin stood at 48.2%, compared to 49.2% in the previous year.

Currency-adjusted sales in the US market, which is the region’s largest market, decreased by 0.9% to
USD 533.5 million.

Currency-adjusted sales in the Asia/Pacific region decreased by 7.7% to € 578.0 million. The share in consolidated sales increased to 23.5%, compared to 22.7% in the previous year.

Currency-adjusted Footwear sales decreased by 10.4%, Apparel sales by 7.4% and Accessories sales remained unchanged at the previous year’s level.

The gross profit margin remained unchanged at the previous year’s level of 50.8%.

Net Assets and Financial Position

Equity

Total assets as of December 31, 2009 increased by 6.1%, rising from € 1,898.7 million to € 2,014.1 million, particularly due to the strong increase in cash and cash equivalents. The equity ratio stood at 61.6%, compared to 62.0% in the previous year. In absolute terms, shareholders’ equity increased by 5.3% to € 1,239.8 million, compared to € 1,177.2 million in the previous year. Despite the global economic conditions, PUMA continues to have extremely solid capital resources.

Working Capital

Due to a strong working capital management, the company succeeded in reducing working capital by 9.9%, or from € 436.4 million to € 393.1 million. As a percentage of sales, this corresponds to an improvement from 17.3% to 16.0%. The working capital improvement was mainly attributable to a significant 19.1% reduction in inventories to € 348.5 million. Trade receivables were up slightly by 0.3% to € 397.8 million, while trade payables decreased by 2.6% to € 262.1 million.

Cashflow

The strong working capital management enabled the Company to achieve its second best free cashflow (before acquisitions) in its history, nearly matching 2004’s record result.

Net cash used for investing activities increased from € 133.3 million to € 139.2 million. Other investing activities include the purchase of fixed assets in the amount of € 54.5 million, compared to € 119.2 million in the previous year, as well as € 84.4 million for purchase price liabilities in connection with corporate acquisitions, compared to € 24.9 million in the previous year.

As a result, the free cashflow improved significantly from € 85.8 million to € 171.4 million. Excluding payments for acquisitions, the free cashflow more than doubled from € 110.7 million to € 255.8 million. As a percentage of sales, free cashflow (before acquisitions) stood at 10.4%, compared to 4.4% in the previous year.

Cash and cash equivalents reported as of December 31, 2009 increased from € 375.0 million to € 485.6 million.

Dividend

The Board of Management and the Supervisory Board will propose a dividend in the amount of € 1.80 per share (previous year: € 2.75) be paid out for the financial year 2009 from the retained earnings of PUMA AG. As a percentage of consolidated net earnings, the dividend pay-out rate increased from 17.8% to 21.2%. The dividend is to be paid out on the day following the Annual General Meeting, where the profit distribution is authorized.

Outlook 2010

In light of the ongoing restrictive consumer environment and the overall global economic volatility, continued restrained consumer behavior is to be expected. A quantitative estimate for 2010 is therefore difficult to make, despite the current positive impetus from the Football World Cup. However, we expect that currency-adjusted sales in 2010 will at least reach last year’s level. PUMA will strive for a gross profit margin comparable to the previous year, despite the present currency hedging position and a higher proportion of team sport products with lower contribution margin.

Increased marketing expenses are to be expected during the World Cup year, whereas the cost reduction program should provide for efficiency increases and cost savings to ensure the company’s sustained earnings power.

A clear improvement in net earnings will be achieved, as no special items are expected for 2010. Under consideration of these planning parameters and omitting the special items, we strive to achieve an improvement of our net results.

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.

Highlights January-March:

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

Outlook 2010:

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

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

Sales and Earnings Development January-March 2010

Global Brand Sales

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

Consolidated Sales

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

Gross Profit Margin

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

Operating Expenses

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

EBIT

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

Financial Result

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

Net Earnings 

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

Net Assets and Financial Position

Equity

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

Working Capital

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

Capex/Cashflow

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

Cash Position

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

Outlook 2010

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

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

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

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

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

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

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

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

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

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

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

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

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

Highlights Second Quarter:

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

Highlights January-June:

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

Outlook 2010:

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

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

Sales and Earnings Development

Global Brand Sales

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

Consolidated Sales

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

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

Gross Profit Margin

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

Operating Expenses

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

EBIT

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

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

Financial Result/Income from associated companies

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

Net Earnings

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

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

Net Assets and Financial Position

Equity

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

Working Capital

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

Capex/Cashflow

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

Cash Position

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

Share Repurchase

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

Other Events

Spain Arbitration Ruling

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

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

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

Outlook 2010

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

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

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

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

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

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

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

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

PUMA AG has initiated a comprehensive special audit by an independent auditing firm, appointed a new local management in Greece and put a halt to further irregularities. According to the preliminary findings of the audit, it is suspected that the Greek joint venture partner, along with members of the Greek local management, has committed a series of criminal acts.

As most of the irregularities have occurred prior to the fiscal year 2010, PUMA will have to restate its prior-year financial statements in line with IAS 8, i.e. adjust the 2009 comparative figures in the 2010 financial report. In total, the maximum extraordinary write-off effect should not exceed pre-tax 115 million Euros and does not affect the cash position. An estimated amount of up to 15 million Euros should affect fiscal year 2010 with the remainder applying to previous years.

Due to these irregularities and the general market situation in Greece, the company is further planning a restructuring in Greece that could lead to additional one-time charges of approximately 15 million Euros in the fourth quarter. As a consequence, it is likely that one-time charges of up to 30 million Euros will be booked in the fourth quarter of fiscal year 2010. A note to financial statements will be included in the third quarter results to be released on 26 October 2010.

PUMA AG’s Management and Supervisory Board have resolved to assert all claims according to civil and criminal law against the Greek Joint Venture minority partner and members of the local Greek management.

Highlights Third Quarter:

• Consolidated sales at € 784 million, up 16.5% in Euro terms
• Gross profit margin remains at 50%
• Operating result before special items improves by 15.3% to € 113 million
• EPS rise from € 4.50 to € 5.16
• Usain Bolt remains long-term brand asset for PUMA
• PUMA AG to take over full control in China and Hong Kong
• Irregularities discovered in Greece

Highlights January-September:

• Consolidated sales increased 5.7% in Euro terms
• Gross profit margin slightly down versus last year at 50.8%
• Operating result before special items improved by 7.7% to € 296.1 million
• EBT before tax improved by 83.2% to € 292.0 million
• EPS increased to € 13.65 from € 7.42 last year
• Continued improvement in equity ratio

Outlook 2010:

• Based on a strong sales performance in the third quarter as well as an improvement in the overall outlook for the fourth quarter, Management now expects sales to be up in the mid to high single-digit for the full year 2010.
• Management expects an increase in EBIT before special items versus last year.
• Extraordinary one-time charge from PUMA Hellas S.A. affects results for 2010 as well as previous year.

Jochen Zeitz, CEO: “Unfortunately, the discovery of irregularities committed by our Greek Joint Venture Partner is casting a shadow on our solid financial performance in the quarter. However, we are pleased to see that PUMA’s operational performance improved significantly in the third quarter as we post a strong rise in sales and operating results. We expect the sales outlook to further improve for the fourth quarter and as a result we raise our forecast of growth to mid to high single digits for the full year 2010. Looking further ahead, we are positive about our capabilities and game plan to execute and deliver on our new “Back on The Attack” Plan 2015 with a potential of reaching four billion Euros. We have prepared our organization and are aligning our processes accordingly to execute our new plan. We are confident and optimistic about the large opportunities to further tap into our brand’s potential growth drivers that we will reveal today during our investor day presentations at the PUMAVision Headquarters in Herzogenaurach.”

Sales and Earnings Development

Global Brand Sales

Sales under the PUMA brand, which include consolidated and license sales, improved by 15.1% to € 828.6 million in the third quarter. In total, the quarter marked a very solid performance against the background of a still challenging global economic environment.

After nine months, global brand sales increased 4.8% and were close to € 2.2 billion despite a flat first half of the year.

Consolidated Sales

Currency-adjusted consolidated sales were up 6.5% to € 784.3 million in the quarter, which represents an increase of 16.5% in Euro terms. Footwear rose 6.0% currency-neutral to € 417.2 million, and Apparel sales improved by 1.3% to € 263.8 million. Accessories sales reported a significant improvement of 25.0% to € 103.3 million, which derives from organic growth as well as first time consolidations. In terms of regions, the Americas grew strongest with 26.7% currency-neutral while APAC advanced 1.4% currency-adjusted. EMEA softened slightly 1.1%.

After nine months, consolidated sales were up 5.7% in Euro terms and flat (-0.1%) currency-neutral at € 2,082.8 million. Despite a challenging market environment, sales in the Americas region jumped a strong 24.9 % with North- and Latin America reporting double-digit sales growth. Sales performance in the EMEA region was impacted by unfavorable market conditions in Southern and Eastern European countries and, therefore, posted a currency-adjusted decrease of 5.6%. Sales in Asia/Pacific were up 1.5% in reported terms but decreased 7.9% due to the strong fluctuations in currencies. In terms of segments, Footwear stood at € 1,117.2 million, representing a currency-neutral decline of 2.7% and Apparel sales softened slightly by 0.8% to € 699.2 million. Accessories sales, however, grew by 14.6% to € 266.4 million.

Gross Profit Margin

In the third quarter, PUMA’s gross profit margin decreased by 180 basis points to 50%. The decline was caused by price sensitivities in the EMEA region as well as changes in the regional as well as product mix.

After nine months, the gross profit margin stood at 50.8% after 51.4% last year. PUMA’s margin in Footwear remained flat at 50.2% while Apparel was at 51.6% after 52.2%. Accessories posted 51.1% compared to last year’s 54.8%. This decrease stems from the impact of the newly acquired and integrated Cobra Golf business carrying a low margin as the former owner, Acushnet, provided sales services outside the US until end of August.

Operating Expenses

The OPEX increased by 10.4% to € 283.6 million in the quarter. This rise is caused by the extension of the scope of business after Cobra Golf was included as well as currency impacts. On a comparable basis, operating expenses were flat, which is reflected in an improved OPEX ratio of 36.2%.

In the first nine months, operating expenses rose by 3.1% to € 776.4 million, which translates into an improved cost ratio of 37.3% versus last year’s 38.2%. The cost savings are a direct result of PUMA’s restructuring and reengineering program, which will be finalized during the fourth quarter 2010.

EBIT

In the third quarter, PUMA’s operating result before special items improved significantly by 15.3% to € 113.0 million versus € 98.0 million last year. As a percentage of sales, this translates into an operating margin of 14.4% compared to 14.5% last year.

As of September 30th, 2010, the operating result before special items rose 7.7% from € 275.1 million to € 296.1 million. The operating margin stood at a solid 14.2% compared to 14.0% last year.

Financial Result/Income from Associated Companies

The financial result shows a negative € 1.9 million for the third quarter and was flat versus last year.

For the first nine months, the financial result improved from € -5.6 million to € -4.6 million, while € 0.5 million of income was generated by associated companies.

Net Earnings

In the third quarter, PUMA’s pre-tax profit (EBT) improved by 15.7% to € 111.1 million after € 96.0 million. This led to an improvement in net earnings, which increased € 9.7 million or a strong 14.2% to € 77.6 million. Earnings per share went up to € 5.16 in the quarter compared to € 4.50 last year.

In the first nine months, earnings before tax stood at € 292.0 million versus € 159.4 million, an increase of 83.2%, while net earnings improved by 83.5% to € 205.5 million from € 112.0 million. Consequently, earnings per share jumped from € 7.42 to € 13.65. The operational tax ratio came in at 29.6% after being at 27.9% last year.

Net Assets and Financial Position

Equity

As of September 30th, 2010, the balance sheet total climbed by 18.4% to € 2,436.5 million. This increase was mainly caused by the inclusion of Cobra Golf as well as currency effects. The equity ratio improved from 59.1% in the previous year to 60.1% this year.

Working Capital

In reporting terms, inventories grew by 27.1% to € 452.9 million while – on a comparable basis – inventories rose by 6.3% to support the expected sales increase in the upcoming quarter. Due to the increase in sales in the quarter, accounts receivables were up by 14.2% (4.7% on a comparable basis), reaching € 606 million. Working capital totaled € 594.2 million (ex acquisition € 518 million) compared to € 523.3 million last year.

Capex/Cashflow

The company invested € 35.5 million in the first nine months into property, plant and equipment versus € 40.8 million last year. An outflow of € 102.4 million (last year: € 75.8 million) is related to acquisitions.

The free cashflow before acquisitions reached € 46.4 million compared to € 145.1 million last year.

Cash position

Total net cash position at the end of September increased to € 360.7 million from € 339.5 million last year, underlining PUMA’s strong financial position.

Share Repurchase

PUMA AG continued its share buyback program in the third quarter and, as of the reporting date, the company purchased 102,219 of its own shares. This equals 0.7% of the share capital and reflects an investment of € 23,4 million.

Other Events

Spain Arbitration Ruling

As announced within the 2010 half-year year financial statements, PUMA AG has filed a cancellation recourse against the arbitration ruling regarding the PUMA trademark rights in Spain. As of the reporting date, legal council and advisers continue to believe that a favourable outcome in this case is more likely than not.

PUMA takes over full control of Business in China as of January 1, 2011

PUMA AG will acquire the remaining 49% of the shares of its long-term Chinese joint venture Liberty China Holding Ltd, effective 1 January 2011, to be in full control of its business activities in China and Hong Kong. Liberty has been a Joint Venture between PUMA and Swire Resources Ltd., of which PUMA has owned 51%. Under the Liberty holding, PUMA China Ltd. and PUMA Hong Kong Ltd. have been responsible for the distribution of PUMA products in China for several years and will continue to do so.

Through the full take over, PUMA’s position in China will be further strengthened and maximized, making sure that the Sportlifestyle Company taps into the enormous potential that the largest market in Asia offers. PUMA will be in sole charge of driving its growth strategy to capture all opportunities on the Chinese market as part of PUMA’s five-year growth strategy. The impact on the consolidated financial statements will be insignificant, as the joint venture had already been consolidated within PUMA AG at 100% since its inception

Irregularities committed by Greek Joint Venture partner

As already mentioned in our ad hoc release on 25. October 2010, irregularities were discovered at PUMA’s Joint Venture ‘PUMA Hellas S.A.’ in Greece, which will affect PUMA’s consolidated financial statements for the full year 2010 and require a restatement of the 2009 figures in the 2010 statements. All necessary measures have been initiated and are on-going. For further information and details please refer to the ad hoc release of Monday, 25 October 2010, on www.about.puma.com

Outlook Full Year 2010

The second half of the year continues to show solid sales growth which should more than offset the flat performance in the first half of the year. Therefore, management now expects full year consolidated sales to grow at a mid to high single digit rate. Considering slight changes in the gross margin, operating result before special items should improve compared to last year.

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

PUMA achieved a company score of 86 points, while the average score in the industry amounted to 54 points. The scores reflect the company’s performance across economic, environmental and social criteria compared to its industry peers and range on a scale from 0 to 100%. SAM, an investment boutique focused exclusively on Sustainability Investing, together with Dow Jones Indexes, rated PUMA’s economic dimension at 86, the environmental dimension at 100 while the social dimension was given a score of 80 in the year 2010.

Through PUMAVision, PUMA’s sustainability concept, the Sportlifestyle company has launched numerous initiatives to drive PUMA to cleaner, greener, safer and more sustainable systems and practices. PUMA’s longstanding work and efforts to improve social, labour and environmental standards throughout its operations date back to 1999. From that time, the company has continuously incorporated environmentally-friendly practices to reduce its impact on the planet and realized several successful large-scale initiatives such as sourcing of raw materials through the Cotton made in Africa campaign to building the capacity of its suppliers as well as the offsetting the company’s CO2 emissions as of 2010.