Puma announced on April 3 that it was suspending the payment of its dividend for this year. Unlike Adidas, which has decided to postpone its own AGM to a still undefined date, the Wild Cat has decided to stick to the previously scheduled date of May 7, but it will hold it as a “digital meeting” over the internet.
To justify the non-payment of the dividend, Puma pointed out that e-commerce accounts for less than 10 percent of its business, so it will not be sufficient to compensate for the closure of its own stores outside China, Japan and South Korea, and those of its retail partners.
As previously reported, Puma’s board of management has already decided to give up its members’ salaries and to reduce those of senior executives by 25 percent as a cash-saving gesture.
Puma added that it is working closely with authorities, retailers, suppliers, landlords and banks to secure additional financing and to find solutions to the crisis caused by the coronavirus.
On the other side of the river in Herzogenaurach, Adidas is reportedly seeking more than €1 billion in aid from the German government under a major financing package whose details have not yet been ironed out. To save cash, it has already stopped its stock repurchasing program for 2020, which would have involved previously budgeted expenditures of €1 billion.
Like H&M, Adidas had also suggested a moratorium on the payment of its store leases in Germany for the month of April, in view of the situation, leading to a public outcry. German Finance Minister Olaf Scholz said it was “irritating” that a big company like Adidas would do such a thing. In a move that was echoed by consumers on the social media, a member of the Social Democrat party, Katarina Barley, said that she would boycott Adidas products.
Adidas then reversed on its decision, publishing a public apology in German newspapers. It also announced that its chief executive, Kasper Rorsted, and other members of the executive board would defer the payment of half of their monthly salaries.
