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Restructuring charges trip up Puma in 2012

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(Globalpost/GlobalPost)

German sportswear giant Puma said Thursday restructuring charges pushed it into the red in the fourth quarter of 2012 and weighed on earnings for the year as a whole.

In addition, the restructuring programme would also negatively affect Puma's performance this year, the company said in a statement.

Puma said that one-off costs of 98.2 million euros ($132 million) in the fourth quarter pushed its bottom-line into a loss of 42.6 million euros in the period from October to December, compared with a profit of 33.1 million euros a year earlier.

In addition to restructuring costs, Puma also had to buy back its trademark rights in Spain from Spanish distributor Estudio 2000.

Taking the year as a whole, the one-off items amounted to 177.5 million euros, which knocked full-year net profit down by 69.5 percent to 70.2 million euros, despite a rise in sales, Puma said.

Fourth-quarter sales rose by 11.7 percent to 804.7 million euros and full-year sales were up 8.7 percent at 3.271 billion euros.

"Despite a continuously challenging market environment, particularly in Europe, Puma delivered a strong sales performance in the fourth quarter, enabling us to meet our sales projections for the full year of 2012," said chief executive, Franz Koch.

Puma said it will pay a reduced dividend of 0.50 euros per share for 2012 from 2.00 euros for 2011.

Looking ahead to the current year, Puma said it expected sales to "remain at a level consistent with that of 2012."

Nevertheless, the restructuring measures would begin to make themselves felt and the group said it envisaged higher earnings both at an underlying and after-tax level.

"Management envisages an increase in EBIT (earnings before interest and tax and special items) in the low- to mid-single digits while net earnings should improve significantly," it said.

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http://www.globalpost.com/dispatch/news/afp/130214/restructuring-charges-trip-puma-2012