Puma Forecasts a ‘Normalization’ of U.S. Market Conditions
Despite achieving record sales and operating profits in FY22, The Cat continues to deal with a myriad of issues, including geopolitical, macroeconomic, and global business uncertainty. And while Puma is predicting a “normalization” of market conditions in the U.S. and China this year, the company has offered a wide annual operating profit range for FY23 from down 8 percent year-over-year to up 4.5 percent to the equivalent of $578.8 million. Puma’s annual revenue forecast calls for high-single digit growth this year.
In Q4, Puma’s net profit slipped 82 percent in euros to about $1.37 billion despite 24 percent sales increases to approximately $2.15 billion. Accelerated promotional activity and higher industrywide promotional activity contributed to a 420-basis point drop in gross margin to 44.0 percent. The Americas region, which includes the U.S., generated 29.0 percent constant-currency sales growth to the equivalent of $978.6 million. Footwear sales rose by 53.0 percent in constant currency to the equivalent of $1.15 billion, driven by multiple segments that included basketball and Sportstyle. Apparel sales dipped by 1.6 percent to approximately $722.8 million and accessories revenues fell by 5.0 percent to about $277.6 million.
For FY22, Puma’s U.S. revenues rose by 30.8 percent in euros to reach approximately $2.29 billion, a nearly 47 percent year-over-year increase in dollars from $1.57 billion in FY21. The Americas region generated a 28.3 percent increase in annual sales to approximately $3.62 billion. Overall annual revenues rose by 24.4 percent in euros to approximately $8.36 billion with net income up 14.2 percent to $$346.8 million as operating income increased 15 percent in euros to $628.4 million. Gross margin fell by 180 basis points last year to 46.1 percent from 47.9 percent in FY21.
Also of note: Today Puma announced in a one-line press release, “She’s back” — signaling that it had resumed its partnership with pop star Rihanna and her Fenty label, and teasing future Puma x Fenty product drops on its website’s homepage.