Puma targets US and China – Economy

The most striking thing about him is his inconspicuousness. Arne Freundt does not have the expansive, Scandinavian nonchalance of his predecessor Björn Gulden. Dark blue hoodie, loose-fitting chinos, multi-day beard, hair pulled back – a friendly, unpretentious early forties, the kind you get to know casually over a beer in the pub in the evening. Or in the gym, which would of course be more appropriate for a man who has just taken over a billion-dollar sporting goods company. Arne Freundt recently became CEO of the sporting goods manufacturer Puma. And if he was excited before his first public appearance in this role, you wouldn’t notice it this Wednesday.

On a completely black stage in the Puma brand center in Herzogenaurach, he presents the business figures of the past year. These are the expected record levels. The 18,000 Puma employees generated sales of almost 8.5 billion euros in 2022, a currency-adjusted increase of 18.9 percent and measured in euros even 24.4 percent. For comparison: The competitor and Herzogenaurach local rival Adidas, which is three times as large, grew by around one percent in 2022. Although Puma’s operating result rose less than sales, 15 percent more (641 million euros) testify to solid profitability. The question in all of this is: What does Arne Freundt have to do with these numbers?

Freundt, a native of Hamburg with two children, an avid runner and skier (“the main thing is outdoor”), has only been CEO of the third-largest sporting goods manufacturer after Nike and Adidas since November 8th. Promoted overnight from the Chief Commercial Officer on the board to number one in the Big Cat House. The rise as such was no surprise, because internally Freundt, who has been with Puma since 2011, has long been considered the crown prince of CEO Gulden. What was amazing was the timing and the circumstances. After nine successful years at Puma, Gulden surprisingly defected to Adidas, where they were urgently looking for a new leader after the failure of CEO Kasper Rorsted. Since then, people have been wondering, not only in the industry, how it could be so easy. Typically, top managers have contracts that preclude direct transfers to competitors. Why not Bjorn Gulden? Or was there perhaps some kind of goodwill arrangement for the Norwegian? Depending on who you ask at Puma, the answer will be professional indifference (“Don’t forget it and move on”), generalities (“That’s life”), a barely quotable incomprehension about your own board of directors – or a helpless shrug of the shoulders.

For the first time, all board members are allowed to speak at the Balance Sheet PK

And yet it is no strange success that Freundt announced this Wednesday; it’s not just the numbers of his lost predecessor, but his as well. The former field hockey and tennis player has long played a key role in the Puma cosmos. His major challenge as CEO is to continue the record hunt started by his predecessor, Gulden, to the delight of investors and employees. Arne Freundt is clearly trying to send out signals that go beyond “keep it up”. For twenty years, only the respective CEO and CFO answered questions at the Puma balance sheet press conference. Freund brought all of his fellow board members with him and everyone is allowed to talk.

There is procurement manager Anne-Laure Descours, French and the most experienced on the podium, both in terms of age and her board membership (since 2019). CFO Hubert Hinterseher, born in 1978, was appointed to the board at the same time as Arne Freundt, less than two years ago. And then there is the former Chilean national handball player Maria Valdes, born in 1983, who has worked at Puma for ten years, but has been a member of the board as Chief Product Officer since January 2023, at Freundt’s request, it is said. So two women and two men, all in all a young group management in a company where the average employee is in their early thirties. In addition, everyone has the right to speak at the most important media event of the year – all of these are messages from the new Puma boss, who has declared himself to be a team worker.

Arne Freundt enjoyed the reputation of a team player even before his promotion. It is also said that he thinks and acts in terms of the brand and its products – like his predecessor and foster father Björn Gulden. The four talk a lot on stage about the visibility of the Puma brand, which needs to be improved. Especially in the USA and China, the largest and fastest growing market in the sporting goods industry. Here and there, Puma must become more popular, says Freundt. In China, Puma generates less than five percent of group sales and is also perceived more as a fashion than as a sports brand. And in North America they are worlds behind Nike and Adidas in terms of market share.

And anyway: Even if the sales of the big cat brand have grown in double digits in the past eight quarters, they have not yet exhausted their potential. “We’re only scratching the surface,” says Freundt. “We stay hungry.” Although it has been committed to the idea of ​​sustainability for years, Puma expects extraordinary impulses from Formula 1, of all things, in addition to its football, basketball and sports fashion business. According to Freundt and Valdes, the expansion of the racing series offers great opportunities for their top supplier Puma, especially in North America. The Netflix series “Drive to Survive”, which exceeded all expectations, showed that Formula 1 is more than madness in circles, namely an expression of modern lifestyle. “In America, Formula 1 has what it takes to become the Super Bowl on wheels,” Freundt believes.

For future success, Puma wants to make more use of the past. The Herzogenaurach-based company is 75 years old this year and the company archive is correspondingly full. With legendary football boot models like the “King” that Pelé and Maradonna once wore. Or famous kicks of great Puma protagonists from other sports, such as tennis legends Guillermo Villas, Boris Becker or Martina Navratilova, the sprinter king Usain Bolt or Formula 1 world champion Lewis Hamilton. “Our archive is full of silhouettes,” says Freundt, which are now to be revived as fashionable sneakers or textile collections.

Arne Freundt does not want to realign Puma, but rather to strategically readjust it. How, he wants to announce in the course of the year, or the entire board wants that. In 2023, Puma sales are expected to grow in the high single-digit percentage range and an operating result of between 590 and 670 million euros is targeted. By the way, Rihanna is supposed to help. The US pop star, celebrated as a style icon, has been responsible for his own Puma collection for a number of years in the past. In the meantime there was radio silence. Now she is involved again as a designer and testimonial. Equipped with a long-term contract.