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Salvatore Ferragamo FY18 revenues drop 3.4 percent

By Prachi Singh

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Business

In its preliminary results statement for the fiscal year 2018, the Salvatore Ferragamo Group said consolidated revenues amounted to 1,347 million euros (1,541 million dollars), down 3.4 percent at current exchange and 1.7 percent at constant exchange rates.

Revenues in the fourth quarter, the company added, declined by 3.6 percent, penalized by the currencies trend, while the decline was 1.8 percent at constant exchange rates, driven by the lower incidence of promotional sales in the primary channel, by lower revenues in the secondary channel and by the negative trends of the wholesale business.

Salvatore Ferragamo reports decline in both retail and wholesale revenues

As of December 31, 2018, the group's retail network counted on a total of 672 points of sales, including 409 directly operated stores (DOS) and 263 third party operated stores (TPOS) in the wholesale and travel retail channel, as well as the presence in department Stores and multi-brand specialty stores.

In FY 2018 the retail distribution channel posted consolidated revenue decline of 3 percent or 1.1 percent at constant exchange rates, with a decrease of 1.4 percent at constant exchange rates and like-for-like sales. In the fourth quarter, retail revenues remained stable at constant exchange rates, with a negative 1.2 percent total like-for-like performance, but positive in the primary channel in all geographical areas.

The wholesale channel, Salvatore Ferragamo SpA said, penalized during all the year 2018 by the destocking activity and the strategic rationalization, registered a decrease in revenues of 3.8 percent or 2.7 percent at constant exchange rates. Fourth quarter wholesale revenues were down 5.4 percent at constant exchange rates, due to the unfavourable performances in EMEA and US, while the Asia Pacific area and the travel retail channel registered positive trends.

Asia Pacific continues to deliver positive results for Salvatore Ferragamo

The company reported revenue drop of 1 percent or rise of 0.8 percent at constant exchange in Asia Pacific area, with a positive performance in Greater China, partially penalized by the negative performance in South East Asia. Specifically, in the fourth quarter, the retail channel in China recorded a revenue growth of 7.6 percent or 10.1 percent at constant exchange rates.

EMEA posted a decrease in revenues of 6.1 percent or 5.9 percent at constant exchange rates due to the negative wholesale business in the last part of the year driven by delayed deliveries following the change of a commercial partner in the Middle East.

Revenues in North America decreased 5.4 percent or 2.4 percent at constant exchange rates in FY 2018, mainly impacted by the negative trend of the department stores sales. The Japanese market registered a drop of 0.4 percent or 1 percent decrease in revenues at constant exchange rates in FY 2018, negatively impacted by the strategic rationalization of the wholesale channel.

Revenues in the Central and South America were down 2.3 percent, but up 3.8 percent at constant exchange rates, driven by the performance of the retail network.

Among the product categories, at constant exchange rates, handbags and leather accessories were up 2.6 percent and fragrances 6.5 percent, while footwear posted a 3.9 percent decrease. In the fourth quarter, footwear reported a growth in revenues in the primary retail channel.

Picture:Facebook/Salvatore Ferragamo

Salvatore Ferragamo