Puma reports strong sales and revenue growth in Q3 despite supply chain issues
German sportswear company Puma reported an increase in its 2021 sales outlook, despite supply chain pressures from Coronavirus lockdowns in Vietnam, port congestion and container shortages.
Third-quarter sales rose 20.4% currency-adjusted to €1.9 billion compared to €1.5 million in Q3 2020, while operating profit jumped to €229 million from €190 million, both well ahead of average analyst forecasts.
Puma sales jumped 31% in the Americas and 22% in Europe, Middle East and Africa. But they only rose 1.7% in Asia and Pacific due to ongoing tensions in China as well as Covid-19 lockdowns in markets such as Japan.
Factories in Vietnam, a big supplier to the footwear industry, have been consistently closed due to COVID-19 outbreaks, with "factory owners not expecting to fully resume operations until the second half of 2022", the company said in a statement.
Despite the uncertainty due to supply chain restraints, the sportswear company credited its strong financial performance to continued brand momentum and successful product launches. The company launched its first lifestyle collection with Brazilian football icon Neymar Jr. in September following his record-breaking switch from rivals Nike last year. The Tokyo Olympic and Paralympic Games saw Puma athletes clinching 75 medals, while French NBA player Killian Hayes and U.S. soccer player Christian Pulisic have signed partnership deal with the brand.
Bjørn Gulden, Chief Executive Officer of Puma, said: “The third quarter was another very strong quarter for us. Despite a lot of operational problems, we grew our sales by 20% and were able to increase our EBIT from € 190 million to € 229 million in the quarter.
"We foresee the high demand for our products to continue, but we also see supply constraints continue to be a problem for the rest of the year. We will continue to manoeuvre through the operational problems as well as possible, but we will also continue to invest in our brand, products and infrastructure for the mid and long term. The outlook for our industry in general and for Puma in particular is in my opinion very positive."
Puma now expects full-year currency-adjusted sales to rise at least 25%, up from a previous outlook for at least 20%, while it sees operating profit between €450 million and €500 million, compared to its previously announced €400 to €500 million.