Sportswear brand Puma (PMMAF (OTC:PMMAF)) saw its shares fall Wednesday after the company announced its preliminary results for 2023 and its outlook for 2024.
The company said its performance was impacted by the "extraordinary Argentine peso devaluation." The company posted revenue growth of around 6.6%, with preliminary 2023 sales of approximately €8.6 billion.
However, the application of hyperinflationary accounting led to a sales decline in the fourth quarter, according to the company. Q4 sales declined by around 9.8% to approximately €1.98 billion.
Looking ahead, PUMA expects a mid-single-digit currency-adjusted sales growth and an EBIT in the range of €620 million to €700 million in 2024.
Reacting to the report, analysts at Citi, who have a Neutral rating and €60 price target on the stock, said the FY24 EBIT guidance was -18% below consensus due to the company's weaker sales outlook.
"FY24 EBIT guidance of €620-€700m is 18% below consensus at the midpoint (consensus: €726m, Citi: €727m), driven by just mid-single-digit cc FY24 growth (consensus: c.+11%, Citi: +9%)," they explained. "FY24 guidance is not related to the Peso devaluation. We expect a strong negative reaction to this print, given the scale of the FY24 downgrade."