Safilo revenue up 3.1% to €939m in 2019 driven by wholesale, Asia-Pacific
The wholesale channel and the Asia-Pacific region (APAC) drove the 2019 sales of Italian eyewear group Safilo, as it reached total revenue of €939 million. Revenue growth was 3.1% at current exchange rates (and 0.9% at constant rates), up from €910.7 million in 2018.
The results will be approved at the board meeting scheduled on March 11, and they exclude the retail business of US chain Solstice, which was sold to American eyewear company Fairway at the end of 2019.
APAC was the star performer, with 23.1% revenue growth at current exchange rates (and +19.2% at constant rates), up to €78 million, an 8.3% share of Safilo’s consolidated revenue. Europe, where the group generates nearly half of its revenue, lost 0.7% and was the worst performer in Q4, with a double-digit decrease (-11.2%) at constant rates.
Wholesale revenue also increased, in line with Safilo’s 2019 forecast, growing 5.2% at current exchange rates (+2.8% at constant rates). At constant rates, wholesale revenue was up 3.2% in Europe, 0.6% in North America and 19.2% in Asia.
The main growth drivers in the wholesale channel were Safilo’s own brands (Carrera, Polaroid and Smith), whose combined revenue rose by 5.7% at constant exchange rates, and also licensed brands. The revenue generated by the supply deal with Kering for Gucci eyewear, which was renewed last October until the end of 2023, was excluded from the wholesale channel’s results.
In Q4 2019, the group’s net sales were €230.4 million, down 2.8% at current exchange rates (and down 4.3% at constant rates), “mainly due to the expected decline in Europe of the business related to the supply agreement with Kering,” said Safilo.
At the end of last year, the group announced the deployment of a very harsh restructuring plan to deal with the loss of the LVMH licenses (Dior and Fendi), whose estimated impact is €200 million.
The plan involves cutting 700 jobs (about one employee in four in Italy) in the Friuli and Veneto regions, while more financial resources will be devoted to developing Safilo’s digital and M&A strategies. The unions are ready to fight tooth and nail against this, following a meeting with Safilo’s senior management on January 28, when the decisions were confirmed. A new round of talks is scheduled on Wednesday February 5.
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