Trainer manufacturer Puma enjoyed a record year: its turnover increased by no less than 31.7 per cent in 2021. However, this year, the sportswear company is fearful of the consequences of a boycott in China and increased costs.
Problems in China
2021 was the best year in Puma’s history, says CEO Bjørn Gulden. Despite the difficulties, sales rose by almost 32 per cent, reaching 6.8 billion euros. Even compared to the pre-pandemic year 2019, sales grew by 30 per cent. Gross profit even multiplied by 2.5 (+166 per cent) to 557 million euros.
For 2022, the trainer brand expects sales growth of at least 10 per cent. The continuing uncertainty surrounding the coronavirus and rising costs throw a spanner in the works, but Puma also has to cope with a consumer boycott in China. CEO Gulden talks about a very tense geopolitical situation.
Like H&M and Nike, the brand attracted controversy because subcontractors allegedly produced cotton in forced-labour camps for Uighurs, an oppressed Muslim minority in China. The brand then decided to stop buying cotton from the region, but that, in turn, angered the Chinese. In the fourth quarter, Puma consequently sold 27 per cent less in the country.
This year, higher shipping costs and raw material prices will also weigh on profitability. The company expects gross profit between 600 and 700 million euros in 2022. “But I remain very optimistic about the future of our industry in general and Puma in particular”, says Gulden.