Corporate | 8 November 2013 08:01
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PUMA SE / Key word(s): Quarter Results
PRESS RELEASE PUMA’s Third Quarter Sales in line with Full Year guidance; New Brand Manifesto – ‘Forever Faster’ Herzogenaurach, November 8, 2013 2013 Third Quarter Facts – Consolidated sales decline by 1.4% currency adjusted to EUR 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 EUR 80 million – EPS climbs from EUR 0.81 to EUR 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 EUR 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 EUR 113 million in 2012 to EUR 121 million in 2013 – EPS rises from EUR 7.53 last year to EUR 8.07 this year Special items announced – Special items of approximately EUR 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 EUR 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 EUR 892 million to EUR 813 million due to the continuing currency volatility generated by several countries.
EEMEA and UK continue to grow
Sales in the Americas were up by 0.7% currency adjusted to EUR 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 EUR 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
PUMA’s Retail Business continues to grow
Sales Performance by Segment
Footwear Sales continue to be difficult
Year-to-date Footwear trend unchanged, Apparel improving, Accessories growing
Margin, Expenses and Profitability
Lower Gross Profit Margin
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
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
Operating expenditures have been brought down from EUR 986 million to EUR 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
Financial Result
Net Earnings / Earnings per share improve
Net Assets and Financial Position
Further strong improvement in Working Capital during the third quarter
Cashflow / Capex
Cash Position
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
In addition, PUMA’s Management also anticipates one-off charges, the majority of which will be non-cash effective, of approximately EUR 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. / 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. / 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:
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 www.about.puma.com . – PUMA SE stock symbol:
Reuters: PUMG.DE, Bloomberg: PUM GY,
Notes relating to forward-looking statements:
PUMA is one of the world’s leading Sports Brands, designing, developing, selling and marketing footwear, apparel and accessories. For over 65 years, PUMA has established a history of making fast product designs for the fastest athletes on the planet. PUMA offers performance and sport-inspired lifestyle products in categories such as Football, Running, Training and Fitness, Golf, and Motorsports. It engages in exciting collaborations with renowned design brands such as Alexander McQueen and Mihara Yasuhiro to bring innovative and fast designs to the sports world. The PUMA Group owns the brands PUMA, Cobra Golf, Tretorn, Dobotex and Brandon. The company distributes its products in more than 120 countries, employs more than 10,000 people worldwide, and is headquartered in Herzogenaurach/Germany. For more information, please visit http://www.puma.com End of Corporate News 08.11.2013 Dissemination of a Corporate News, transmitted by DGAP – a company of EQS Group AG. The issuer is solely responsible for the content of this announcement. DGAP’s Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de |
| Language: | English | |
| Company: | PUMA SE | |
| PUMA Way 1 | ||
| 91074 Herzogenaurach | ||
| Germany | ||
| Phone: | +49 9132 81 0 | |
| Fax: | +49 9132 81 2246 | |
| E-mail: | investor-relations@puma.com | |
| Internet: | www.puma.com | |
| ISIN: | DE0006969603 | |
| WKN: | 696960 | |
| Indices: | SDAX | |
| Listed: | Regulierter Markt in Frankfurt (Prime Standard), München; Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover, Stuttgart; Terminbörse EUREX | |
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