Puma: Good Results and Rumors of Sale
After a positive year of consolidation, as was the 2016 for Puma the flagship sports brand of the Kering group, expects solid results in this first quarter, estimating the company that will be able to exceed billions of euros in turnover.
They are also very optimistic about EBITDA growth (earnings before interest and taxes) that they expect to exceed 70 million euros. Recall that this indicator was for all 2016 of 128 million euros, reaching a net profit of 68 million euros. In 2016, sales for the year rose 10 percent, after currency adjustments, to 3.63 billion euros, while they rose 7 percent on a neutral basis. Earnings (after currency adjustments) were led by the EMEA region (Europe, Middle East & Africa), with a 13.2 percent growth; followed by the Asia / Pacific region, with an increase of 8.5 percent; And by the Americas, with 8.3 percent.
Moderate growth on sales of Puma
In the fourth quarter of 2016, however, the company experienced a net loss of 4.6 million euros due to an increase in marketing expenses and investment in joint ventures in the US. All this despite the fact that revenues increased in the period by 9% to 958.2 million euros, with sales of footwear with a particularly good performance.
Bjørn Gulden, executive director of Puma, in his letter in the 2016 annual report, noted, for example, the success of the Puma Fierce collection, led by Kylie Jenner, who did not just drive sales, but also helped to secure space on the shelves and to get ample media coverage. Very remarkable is the contribution of Rihanna, who since 2015 is one of the creative directors of Puma.
Exit of F-Henri Pinault and selling rumors
Puma has confirmed that François-Henri Pinault is no longer a member of its newly elected board of directors, which has revived speculation that its parent company Kering SA has begun exploring options for the sale of the sportswear brand.
«We confirm that Mr. Pinault is no longer a member of the newly elected Puma Board of Directors and that Thore Ohlsson has been appointed Vice Chairman,» a company spokesman said after the Puma General Shareholders’ Meeting in Germany. In addition to Pinault’s departure, Todd Hymel, CEO of Volcom, Kering’s Californian sportswear brand, also resigned from Puma’s board of directors.
This is not the first time that Kering has faced rumors about a hypothetical sale of Puma, although Pinault made it clear recently that Kering would retain its majority stake in Puma. However, the luxury multinational could be studying potential buyers, before making sure they receive the best possible offer for the prestigious brand of sportswear. The company closed its stock price at EUR 367 at the Frankfurt XETRA on April 25, at its highest since the financial crisis of 2008 and with tremendous momentum since it reached a minimum price of EUR 142 in June 2015.
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