Puma AG reported that sales under the PUMA brand, which include consolidated and license sales, improved by 15.1% to €828.6 million ($1.06 billion) in the third quarter.

Currency-adjusted consolidated sales were up 6.5% to € 784.3 million ($1.01 billion) in the quarter, which represents an increase of 16.5% in Euro terms. Footwear rose 6.0% currency-neutral to   €417.2 million ($538.8 mm), and Apparel sales improved by 1.3% to € 263.8 million ($340.4 mm). Accessories sales reported a significant improvement of 25.0% to € 103.3 million ($133.3 mm), which derives from organic growth as well as first time consolidations.

In terms of regions, the Americas grew strongest with 26.7% currency-neutral while APAC advanced 1.4% currency-adjusted. EMEA softened slightly 1.1%.

In the third quarter, PUMA’s gross profit margin decreased by 180 basis points to 50%. The decline was caused by price sensitivities in the EMEA region as well as changes in the regional as well as product mix. Operating expenditures increased by 10.4% to €283.6 million ($365.9 mm) in the quarter. This rise is caused by the extension of the scope of business after Cobra Golf was included as well as currency impacts. On a comparable basis, operating expenses were flat, which is reflected in an improved OPEX ratio of 36.2%.

In the third quarter, PUMA’s operating result before special items improved significantly by 15.3% to €113.0 million ($145.8 mm) versus € 98.0 million last year. As a percentage of sales, this translates into an operating margin of 14.4% compared to 14.5% last year. In the third quarter, PUMA’s pre-tax profit (EBT) improved by 15.7% to € 111.1 million ($143.4 mm) after € 96.0 million. This led to an improvement in net earnings, which increased €9.7 million ($12.5 mm) or a strong 14.2% to €77.6 million ($100.1 mm).

Earnings per share went up to € 5.16 ($6.66) in the quarter compared to € 4.50 last year. 

In reporting terms, inventories grew by 27.1% to €452.9 million ($584.3 mm) while – on a comparable basis – inventories rose by 6.3% to support the expected sales increase in the upcoming quarter. Due to the increase in sales in the quarter, accounts receivables were up by 14.2% (4.7% on a comparable basis), reaching € 606 million ($781.9 mm).

Working capital totaled € 594.2 million ($766.6 mm) (ex acquisition € 518 million($668.3 mm)) compared to € 523.3 million last year.

The second half of the year continues to show solid sales growth which should more than offset the flat performance in the first half of the year. Therefore, management now expects full year consolidated sales to grow at a mid to high single digit rate. Considering slight changes in the gross margin, operating result before special items should improve compared to last year.

“Unfortunately, the discovery of irregularities committed by our Greek Joint Venture Partner is casting a shadow on our solid financial performance in the quarter,” said CEO Jochen Zeitz. “However, we are pleased to see that PUMA’s operational performance improved significantly in the third quarter as we post a strong rise in sales and operating results.
 
“We expect the sales outlook to further improve for the fourth quarter and as a result we raise our forecast of growth to mid to high single digits for the full year 2010. Looking further ahead, we are positive about our capabilities and game plan to execute and deliver on our new “Back on The Attack” Plan 2015 with a potential of reaching four billion Euros.”