May 15, 2019
Ferragamo sees Q1 sales, profits swing back to growth
May 15, 2019
Italy’s luxury shoemaker Salvatore Ferragamo saw a return to growth the first quarter of 2019, after total revenues increased on the back of retail and wholesale revenues and surging sales growth in China.
Total revenues grew 4.3% at current exchange rates to 317 million euros ($355.4 million) and adjusted core profit (EBITDA) totaled 34 million euros compared with 32 million a year ago.
Analysts had expected 315 million in sales and 34 million in earnings before interest, tax, depreciation and amortization, according to Reuters.
Revenue growth was driven by the retail distribution channel, up 3.9%, while wholesale revenues also returned to growth, supported by airport shops, up 5.5%.
The Asia Pacific region was the group's top market in terms of revenues, increasing by 7.2%, with China driving the uptick, increasing 21.2%.
Europe posted an increase of 2.8%, with a positive performance in both distribution channels, while North America recorded stable revenues, down 0.7% at constant exchange rates.
The Japanese market registered an increase of 2.1%, while Central and South America sales surged 13.8%, said the company on Tuesday.
The group's footwear posted an increase of 7.3% and handbags and leather accessories were up 8.7%. Fragrances registered a 24.3% decrease, mainly due to a different timing in products’ launches, said the firm.
Tuesday's earnings announcement comes after an unsteady 12 months for the Italian brand. With her recent appointment to CEO in July, Ferragamo's new Chief Executive Micaela Le Divelec Lemmi continues to turnaround the heritage brand.
Strategies include attracting more millennials to the brand by homing in on digital communication and distribution without forsaking the brand's traditional customer base.
She arrived at Ferragamo last April, after working for fellow Italian icon Gucci.
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