On May 7, the German sports brand Puma (PUMG.DE) released its first quarter 2020 financial report, and its net profit fell sharply.

Financial report data shows that Puma’s first-quarter sales were 1.3 billion euros, a decrease of 1.3% year-on-year; net profit was 36.2 million euros, a decrease of 61.6% year-on-year.

Puma was founded in 1948. It specializes in sportswear and footwear products. It owns PUMA, Cobra Golf and Tretorn, and its products are located in many countries and regions around the world.

However, due to the impact of public health security incidents, about 80% of Puma stores closed in the first quarter, resulting in a serious decline in net profit, and store sales around the world have been hit hard.

Sales in Asia Pacific markets such as Singapore, Malaysia, Japan, and South Korea, with Chinese tourists as the main driving force, fell 12% year-on-year.

The current decline in sales in the Asia-Pacific market is a heavy blow to Puma. Because the Asia-Pacific market has always been Puma’s “main battlefield”, when Puma’s sales exceeded 5 billion euros for the first time in 2019, the strong growth of the Asia-Pacific market has made a huge contribution to Puma’s.

Sales in the Asia-Pacific region declined in the first quarter, causing a big blow to Puma. Although the Chinese market has recovered, most of the factories in China have already started production normally, and overseas logistics have started to operate normally. But Puma does not expect sales to return to normal levels in the short term.

At the same time, Puma CEO Bjorn Goulden also said: “The first quarter is very difficult, but we feel that it is doing well. The financial situation in the second quarter will be even worse, and more than 50% of the global sports venues will be closed.

In its current form, Puma has maintained cash flow through credit and announced that it will receive a credit line of 900 million euros.

However, relying on credit is not a long-term solution. Puma still has to rely on performance to “rescue” itself.