Puma wins Germany loan worth 625 million euros

Agence France-Presse
Puma wins Germany loan worth 625 million euros
Sportswear company Puma announces the loan as it posts a 61.6% drop in net profit in the 1st quarter of 2020

BERLIN, Germany – German sportswear maker Puma has secured 625 million euros ($675 million) in government loans to help mitigate the effects of the coronavirus pandemic, the company said on Thursday, May 7.

Puma said it had won a new credit facility of 900 million euros through a consortium of 12 banks, including 625 million euros from German state-owned investment bank KfW.

Unlimited loans from KfW are part of a wide-ranging rescue package announced by the German government in March to help businesses weather the economic storm caused by the virus.

The rescue plan worth almost 1.1 trillion euros included 100 billion euros in support for KfW.

Puma’s historic hometown rival Adidas received an emergency loan of 2.4 billion euros from KfW in April.

Like many clothing firms, Puma has been dealt a huge blow by restrictions imposed to slow the spread of the virus. At the end of March, 80% of its stores around the world were closed.

In the 1st quarter of 2020, net profit was down 61.6% on last year, falling from 94.4 million to 36.2 million euros, the company said.

“The 2nd quarter will financially be even worse with more than 50% of global sports and sport lifestyle space being closed,” Puma chief executive Bjorn Gulden said.

However, he added the company was starting to see some improvement in South Korea and China, and noted that “Europe is hopefully also moving towards a recovery.”

“2020 is and will be a difficult year, but we [are doing] everything we can to recover and to get back to strong growth in 2021,” Gulden said. – Rappler.com