In the outlook of the 2019 Annual Report, PUMA forecasted a slight improvement in the gross profit margin for the financial year 2020. PUMA expected a slightly weaker increase of other operating income and expenses (OPEX) compared to net sales. The forecast for the operating result (EBIT) was within a range of between €500 million and €520 million. In addition, a significant improvement in net earnings was expected for the financial year 2020. However, due to the significant negative impact and considerable uncertainty of the COVID-19 pandemic, this forecast had to be withdrawn when the results were published for the first quarter of 2020.

More details on earnings development in the past financial year are provided below.


PUMA’s gross profit in the financial year 2020 decreased by 8.5% from €2,686.4 million to €2,458.0 million. The gross profit margin fell by 180 basis points from 48.8% to 47.0%. This was mainly due to negative currency exchange effects from hedging due to a less favorable annual average US dollar hedging rate in 2020 compared to the previous year. In addition, increased sales promotions to limit the decline in sales as far as possible and to optimize inventory levels, alongside increased write-downs on inventories, contributed to the decline in gross profit margin in 2020. In contrast, the higher proportion of sales from our own-retail activities and an improved regional sales mix had a slightly positive effect on the development of gross profit margin.

The gross profit margin in the Footwear division decreased from 46.4% in the previous year to 45.7% in 2020. The Apparel gross profit margin fell from 51.1% to 48.5%, and in Accessories it also decreased from 50.5% to 47.0%.

The strong focus on cost-saving measures implemented directly in response to the COVID-19 pandemic at the end of the first quarter and during the second quarter led to a slight decrease in other operating income and expenses of 0.3%, from €2,271.3 million to €2,264.9 million in the financial year 2020. Nevertheless, compared to sales, the cost ratio increased from 41.3% in the previous year to 43.3%.

G.11 Operating Expenses (€ million)

Within sales expenses, marketing/ retail expenses decreased by 5.6% to €1.050,2 million, while the cost ratio remained almost unchanged compared to the previous year at 20.1% of sales. Other sales expenses, which mainly include sales-related costs and costs for warehousing and logistics, increased by 4.9% to €743.9 million. This increase was mainly due to higher costs for warehousing and logistics in connection with the increased e-commerce business. The cost ratio of the other sales expenses was 14.2% of sales in 2020 compared to a cost ratio of 12.9% in the previous year.

Research and development/ product management expenses decreased by 10.2% to €102.6 million compared to the previous year and the cost ratio fell slightly to 2.0%. Other operating income in the past financial year amounted to €0.4 million and consisted primarily of income arising from the sale of fixed assets. General and administrative expenses increased by 8.5% to €368.8 million in 2020, mainly due to increased write-downs on receivables, as the negative macroeconomic impact of the COVID-19 pandemic increased the risk of default on receivables in the financial year 2020. This led to an increase in the cost ratio of general and administrative expenses to 7.0%. Depreciation and amortization is included in the relevant costs and total €275.7 million (previous year: €246.4 million). In addition, the respective costs include impairment losses relating to goodwill and right-of-use assets totaling €18.0 million (previous year: €0.0 million).

Result before interest, taxes, depreciation and amortization (EBITDA)

The result before interest (= financial result), taxes, depreciation and amortization (EBITDA) decreased by 26.8%, from €686.6 million to €502.9 million, in the financial year 2020. The EBITDA margin reduced accordingly from 12.5% in the previous year to 9.6% in 2020.

Operating result (EBIT)

The decline in sales and gross profit margin due to the negative impact of the COVID-19 pandemic, which could not be compensated for by the reduction in other operating expenses, led to an overall decrease in the operating result (EBIT) of 52.5%, from €440.2 million in the previous year to €209.2 million in 2020. This corresponds to a decline in EBIT margin from 8.0% in the previous year to 4.0% in 2020.

G.12 Operating result - EBIT

Financial Result

The financial result decreased in 2020 from a total of €-22.6 million in the previous year to €-46.8 million. This development is attributable, on the one hand, to losses from currency conversion differences amounting to €-3.9 million in 2020 compared to gains from currency conversion of €10.2 million in the previous year. On the other hand, the interest result, the net balance of interest income and interest expenses, fell from a total of €-32.8 million in the previous year to €-42.9 million in 2020. The decrease in interest result was mainly attributable to an increase of €11.6 million in expenses from interest components related to cash flow hedging (“swap points”).