After a buoyant first quarter, and with improved prospects, Puma upgraded its forecast for sales and operating earnings for the full financial year. Two weeks ahead of the scheduled release of its quarterly performance, the company said that its full-year sales should increase at a low double-digit rate in constant currencies, to yield an operating result of €185 million to €200 million.
This compares with an earlier forecast that its sales should rise at a high single-digit rate in constant currencies, with Ebit set to reach a level of between €170 million and €190 million. Puma continues to anticipate that net earnings will improve significantly.
The upgrade comes after Puma achieved a sales increase of 18 percent to €1,005 million for the first quarter, which was a rise of 15 percent in constant currencies. The operating result for the quarter was up by about 70 percent to €70 million. The detailed results will be issued on April 25.
The improved guidance was issued on the day of the company's annual shareholders meeting in Herzogenaurach, which also saw some interesting changes on its administrative board, a form of supervisory board. François-Henri Pinault, vice-chairman of the board, was not a candidate for re-election. Pinault is the chief executive of Kering, the French company that acquired Puma in 2007. He is being replaced as vice-chairman by Thore Olsson, who has been a particularly influential member of the board since 1993.
Todd Hymel, chief executive of Volcom, the Californian action sports brand owned by Kering, who joined the board in 2012, was not up for re-election either. But Jean-François Palus, managing director at Kering, remains chairman of Puma's board. He has been very directly involved in the company's turnaround in the last years.
The move inevitably raised questions about Kering's intentions regarding its ownership of Puma. Pinault and his lieutenants have repeatedly denied having intentions to sell the sports group in the short term. However, the company is clearly focusing more strongly on the development of its luxury brands.
Two other Kering executives remain on the administrative board: Jean-Marc Duplaix, Kering's chief financial officer; and Béatrice Lazat, the French company's senior vice-president of human resources.
The board was effectively reduced by three members. The company did not replace the two departing Kering executives, and the number of employee representatives was also reduced from three to two.
