Puma’s CEO Arne Freundt said the sportwear brand had “fully delivered” on its outlook for Q2 2024, despite “increased currency headwinds, stressed supply chains and macroeconomic and geopolitical challenges”.
Despite a 23.8% decline in net income for the quarter, Puma said the results were “fully in line with our expectations” and said it expects the second half of 2024, particularly Q4, to be stronger with improved net income.
“The robust demand for the Puma brand continues to be driven by our great product newness and innovation which we launched in the past months,” Freundt added.
Globaldata’s senior apparel analyst Pippa Stephens said the brand's Q2 continues on an upwards trajectory and benefits from the gradual recovery of consumer confidence.
Key results for Puma in Q2 2024
- Gross profit margin increases by 200 basis points to 46.8%
- Currency-adjusted sales increased 2.1% to €2,177m
- Net income decreased by 23.8% to €41.9m, down from €55m in Q2 2023.
Puma’s gross profit margin was 46.8%, despite “significant headwinds” from currencies and “tailwinds from sourcing and freight”.
The company reported a 4.3% increase in expenses thanks to warehouse costs and digital infrastructure projects.
The sportswear brand reported improved wholesale business in all regions, except EMEA where sales decreased 4.3% to €817.8m, which Puma attributed to a strong prior year.
Puma’s wholesale business declined 3.3% to €1,529.6m, which it attributed to the decline in its EMEA business as all other regions saw improved wholesale business. Direct to customer sales grew 19.5% to €587.7m, thanks to brand momentum and scaled-back promotions.
While footwear sales were flat at €1,907m, Puma said its performance categories were performing well. Apparel sales grew 9.2% but accessories declined by 4.7%.
Puma said the operating result and net income was “fully in line” with its expectations and outlook for FY 2024.
Key results for H1 2024
- Sales increased 1.3% to €4,219.6m
- Currencies negatively impacted sales by €150m in H1 2024
- Net income decreased by 25% to €129.3m
Puma said currencies were a “major headwind” over H1, negatively impacting sales by approximately 2.1%.
Stephens described the H1 results as “lacklustre” and reflective of the “struggles of the overall sportswear market as consumers restrain their purchases amid macroeconomic issues”.
What next for Puma?
Puma said its ‘fastest running boot’ and ‘fastest running trainer’ would be key innovations for the second half of 2024. Freundt added that the brand was “continuing to stir up the basketball market with new disruptive designs in the coming year”.
“With the brand providing kits for numerous athletes competing in the Paris Olympics, this should help to increase its visibility in EMEA in H2,” GlobalData's Stephens added.
“The Olympics buzz, new partnerships with the likes of K-Pop star Rosé, and improved economic conditions in Europe will hopefully contribute to a stronger performance from these categories in H2.”
Last week, Puma came top of Fashion Revolution's What Fuels Fashion report, which ranked brands based on their transparency around their use of fossil fuels.
