Asia-Pacific and the Americas powered Puma’s growth in the first quarter of 2021 as a string of marketing efforts and tech innovations drove demand for footwear and apparel. And while the rest of the year looks challenging due to surging global COVID-19 cases, Puma is bullish on its full-year prospects.
In the three months to March, sales at the German sports and sports-lifestyle brand jumped 26 percent to $1.87 billion (€1.55 billion) on a constant currency basis, much better than the flat performance from larger rival Nike in the equivalent quarter. Puma’s net earnings also increased sharply from €36.2 million to €109.2 million.
The Americas region led with 38.5 percent followed by Asia-Pacific at 29 percent. Greater China was the pacemaker there, as it was in Q4 last year. Meanwhile, lockdowns in major European markets took their toll on the EMEA region which trailed at 14 percent. Puma’s biggest product segments, footwear and apparel, both advanced by 27 percent thanks to strong demand in the running, training, and “sport style” categories.
Marketing activities and tech innovations in Q1 are also delivering greater brand awareness and sales for Puma. These included the She Moves Us communication and direct-to-consumer (D2C) platform celebrating women and featuring Dua Lipa; the Only See Great optimism and self-belief campaign which lays the foundations for multiple product launches over the course of this year; and new Nitro technology to capitalize on the pandemic running boom.
The DTC business — which includes owned and operated retail stores as well as e-commerce — topped $400 million in Q1 driven by online momentum of 75 percent. Online-to-offline development this year across markets in Mexico and Southeast Asia will further enhance Puma’s digital capabilities.
Puma CEO Bjørn Gulden said in a statement: “Q1 was very strong despite Covid-19 restrictions and supply chain issues due to container shortages and port congestion. Unfortunately, 2021 will again be a year with a lot of uncertainty (but) we will continue to invest in product and marketing, strengthen our relationships with retail partners and do everything we can to please our consumers.”
Gulden expressed confidence that 2021 would be a better than 2020 and he expects to achieve full-year sales growth in the mid-teens and significantly better profitability compared to last year. While the brand has been hit by boycotts of Western brands in China, the country will remain central to growth in the Asia region.
Though he was optimistic for the coming months, approximately 30 percent of retail stores selling Puma products in Europe and Latin America remained closed at the end of April due to lockdowns. The remaining 70 percent are mostly operating with significant restrictions.
With global COVID-19 cases rising again, new restrictions and lockdowns have reappeared in other parts of the world such as India, Canada, and Turkey. “We therefore foresee a continued negative impact of the pandemic on our business throughout 2021,” the company said in a statement.
Nevertheless, Puma is convinced it will emerge stronger from the COVID-19 crisis based on the fact that it is sitting on “a very positive order book” and has a full product pipeline for the rest of the year.