Despite averse exchange rates, Puma's turnover has grown in the past quarter mainly thanks to shoe sales, which have grown for the first time in seven quarters.
Lower profit because of higher marketing costs
The German sports item manufacturer saw its third quarter turnover reach 843 million euro, a 3.7 % growth (6.4 % if exchange rate fluctuations are ignored). Profit did not follow the same trajectory as it almost halved from 53 to 29 million euro.
The profit drop was the result of increased marketing efforts focused on its transformation on the back of its new baseline, "Forever Faster". The company signed, among others, the fastest man alive (Usain Bolt) and football's enfant terrible (Mario Balotelli) to promote its new direction. It also struck a deal with English football club, Arsenal, all deals which cost a lot of money.
It seems to be paying off though, as Puma has managed to increase its running and football shoes sales (+ 2 % to 374 million euro). Clothing also grew 11 % to 323 million euro, while accessories managed to sell 147 million euros' worth. Only golf-related sales have slumped, something the other German sports icon, Adidas, also realized this past quarter.
Full-year forecast slightly up
"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", CEO Björn Gulden said.
The company is fully confident it will work out, because the board has raised its full-year forecast. It had previously stated it would remain level compared to 2013, but now it should be able to achieve a "low, single-digit growth".