Puma, the German sportswear brand, has acknowledged the difficulty of predicting its financial performance for the rest of the year due to the ongoing COVID-19 pandemic. The company experienced a significant decline in sales and profitability during the second quarter, which CEO Bjoern Gulden described as the most challenging quarter in his career.

In Q2, Puma’s sales plummeted by 30.7% to €831 million, and its EBIT recorded a loss of €114.8 million compared to €80.3 million in the same period last year. These figures fell short of the average analyst forecasts. The closure of sports and fashion retail establishments worldwide as a result of lockdown measures played a major role in this decline, with approximately 85% of these stores closing their doors.

To weather the crisis, Puma focused on securing financing and ensuring liquidity. While the company highlighted the potential of e-commerce to compensate for losses, it was not enough to fully offset the overall sales decline. In May, Puma secured a revolving credit facility of €900 million, with €625 million coming from German bank KfW, which is government-owned. This injection of funds provided the necessary financial support for Puma to navigate the challenging market conditions.

The sales performance of Puma during Q2 clearly demonstrated the impact of the pandemic. Sales dropped by 55% in April and decreased by 38% in May. However, by the end of June, there was a slight improvement, with sales only down by 6%. By that time, Puma had managed to reopen 85% of its owned and operated stores.

Despite the hardships faced this year, there is some hope for the future. The demand for sporting goods has surged as more individuals engage in exercise and fitness activities. The CEO predicts that markets could begin to recover by the end of 2020, with the potential for growth in 2021. However, he also cautions that there is a high risk of a second wave of infections, which could further impact the industry and overall economic recovery.

The unpredictable nature of the current environment has hindered Puma’s ability to provide an accurate financial outlook for the rest of the year. The ongoing increase in global infections, coupled with the potential for continued disruption, makes forecasting the company’s performance extremely challenging. As circumstances continue to evolve, Puma will remain focused on adapting its strategies to navigate through the uncertainties and emerge stronger in the post-pandemic era.

Useful links:
1. Puma Official Website
2. Worldometer COVID-19 Updates