Citing expected currency headwinds, higher freight costs and continued muted consumer sentiment, German sportswear brand Puma has narrowed its outlook for full-year core profit even as the brand reported its second-quarter results.
Having recently launched new marketing initiatives to better compete with larger rivals like Adidas and Nike, Puma has been grappling with weaker consumer demand and excess stock at the sportswear retailers through which it makes most of its sales.
The company now expects operating profit (EBIT) to range between €620 million-€670 million ($676-$731 million), compared to its previous forecast of €620 million to €700 million.
The company expects net income to change in 2024 in line with the operating result. It reported a net income of €304.9 million in 2023.
In the second quarter, the company’s currency-adjusted sales rose by 2.1 per cent to €2.12 billion, aligning closely with the €2.15 billion expected by analysts, according to LSEG data. This growth was driven by a 9 per cent increase in the Americas region.
However, in the Europe/Middle East and Africa region, currency-adjusted sales dropped by 4.3 per cent to €817.9 million. While Europe returned to growth, this was offset by declines in Eastern Europe, the Middle East, and Africa, following a strong quarter in the previous year.
In the Asia/Pacific region, the company’s sales grew by 1.9 per cent, boosted by growth in Greater China. Its quarterly EBIT increased by 1.6 per cent to €117 million despite negative currency effects.
