Environment:

- Creation of a new Sportstyle by Cara Delevingne and Selena Gomez

- Partnership with Manchester United and Valencia CF
- Launch of PUMA ONE football boot
- New partnership regarding motorsports with Porsche

ROE:
- Ratio of profit invested in equity
- the ratio should be used to cover the shareholders in the medium term
- depends on the environment and on the risk and also on the interest rates of the country →
can be irrelevant due to the global presence of PUMA
- 14% is a correct number for the ROE especially for the global size of PUMA and
there was an increase compared to last year

ROS
- ratio of profits to net sales revenue → efficiency of the company
- depends on the market and the sector
- 5% can be considered as low, but the ROS in retail is generally lower
- However, it can be considered as relatively low even for a retail and considering the
impact of Puma

EBIT Margin
- ratio of operating profit to net sales revenue
- does not take into account extraordinary effects
- used to compare profitability of two companies and depends on the size of the
company or through the years also
- 8% is really low but it can be understandable due to the size of the company

Current Ratio
- ratio of current assets to current liabilities
- shows how short term liabilities can be served in the best case
- the target ratio should be 100%: below the company could experience liquidity problems and
above a maturity congruity exists → short liabilities can be covered by current assets
- 280% is over 100% and therefore a maturity congruity exists

Days of sale outstanding (DOS)

- with account receivables turnover, they show how long capital is considered as trade
receivables.
- a low DOS is considered as positive because the customer pay more quickly
- however the country has to be taken into account because the terms vary depending
on the country
- Also types of customer can vary → sport associations or individuals

Free Cash Flow

- This number defines how much cash a company has and if the company can
conclude future economic decisions
- the calculation should be done over several years and those should then be
compared
- in the long term it should be very positive
- however, a negative FCF can result out of high investments
- the FCF rose over the year in the case of Puma
- it depends essentially on environment of the company
Equity Ratio
- ratio of equity to liabilities and equity
- when looking at security and stability, the highest possible ratio should be attained → the
higher the ratio, the more risk the company can bear
- however for reasons of return, the ratio should be low (leverage effect)
- a clear decrease can be observed in the two years, probably due to an
acquisition made by Puma such as the partnership with the two stars

Debt-to-Equity ratio
- also called leverage, so the ratio of financial debt (or liabilities) to equity
- can be used as an insolvency indicator because it depicts if the shares of debts tend
to rise, that would be the case if the ratio was high
- a high ratio means also that the company has not a lot of freedom concerning
financial means
- furthermore, the higher the ratio, the higher the creditor risk → which can lead to further
uncertainty of the company
- in the case of puma, the ratio increased, and this signals that the company used
most of its equity to finance a new investment

Equity to non-current asset ratio

- shows how many non current assets (long term) are financed with equity
- because financing low-risk assets with equity is expensive, it is preferable to finance
high-risk assets with the risk bearing capital
- target ratio is 100% at least
- in the case at hand, the ratio decreased probably due to a new investment but it is
still slightly over the target ratio

Conclusion

- Except for the Return On Sales and the EBIT margin, which both are relatively low,
Pumas financial report presents some good results
- Furthermore, the decline in the equity ratio can be explained by all the acquisition
that Puma made