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Puma Q1 sales jump 14% to €2.2bn

Its wholesale business also increased by 12.4% to €1.7bn (£1.5bn), while its direct-to-consumer (DTC) business jumped 22.5% to €465m (£412m)

Sportswear giant Puma has revealed its first quarter sales jumped 14% to €2.18bn (£1.93bn) boosted by strong sales in its EMEA region and a return to growth in China for the first time in two years.

It said its sales performance was driven by a 28.8% increase in footwear sales with continued strong demand for its performance categories like football, basketball, running and training and golf as well as for its sportstyle category.

Its wholesale business also increased by 12.4% to €1.7bn (£1.5bn), while its direct-to-consumer (DTC) business jumped 22.5% to €465m (£412m).

Meanwhile, sales in owned and operated retail stores increased 17.3% and e-commerce jumped 32.7%. It said the strong growth in DTC, especially in e-commerce, was primarily driven by “continued brand momentum and improved product availability”.

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However, its Q1 EBIT declined by 10.5% to €175.5m (£155.4m) amid higher costs due to “ongoing industry-wide promotional activity, higher sourcing and freight costs as well as unfavourable currency effects had a negative impact on the gross profit margin”.

Arne Freundt, Puma CEO, said: “Our Q1 growth was a strong start to 2023. In line with our strategy to be the best partner to retailers, we grew our wholesale business in a challenging environment and further strengthened our performance credibility with strong growth in our strategically important performance categories. Our significant growth in DTC demonstrated PUMA’s continued brand momentum globally, including North America and Greater China.

“We benefited from our geographically diversified business, as strong growth in other regions more than offset the decline in North America. The current development of our North American business confirms the importance and necessity of our new strategy to grow more desirable distribution channels and to contain the off-price business in North America as well as to further elevate the brand.”

He added: “It is reassuring that we returned to growth in Greater China after more than two years of declining business and we are cautiously optimistic about an ongoing positive development. We consider 2023 to be a year of transition. In line with our expectations, the year has started with pressure on gross profit margin and profitability.

“For the second quarter, we expect low to mid single-digit sales growth due to high inventory levels in the trade and continued headwinds in the market. For the full year, we confirm high single-digit sales growth and EBIT of €590-€ 670m (£522-593). With our continued momentum we are fully on track to normalise our inventory levels and to achieve our full-year guidance.”

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