Ferragamo posts decline in FY23 sales and profit

The Salvatore Ferragamo Group reported revenues of 1,156 million euros, down 7.6 percent at current exchange and down 8.1 percent at constant exchange rates for FY23.

The company attributed the decline to the transition of the product offer, while continuing the optimisation of the network, against the backdrop of a softening luxury market, especially in the second part of the year.

Commenting on the full year trading, Marco Gobbetti, the company’s chief executive officer and general manager said: “We will continue to work on the full deployment and optimisation of the product offer to drive desirability and engagement, generating interest through an impactful communication, also maximising the potential of all digital touchpoints. Notwithstanding some impact of the current market backdrop on the timing of our initial assumptions, we continue to pursue our growth ambition, while also protecting profitability through ongoing attention to the quality of sales and disciplined focus on costs.”

Ferragamo FY23 profit drops 43.7 percent

The retail distribution channel posted a 10.8 percent or 7.7 percent drop in sales at constant exchange, penalised by a general weakening of the luxury demand in the last months of the year.

The wholesale channel registered a decrease of 12.2 percent or 10.3 percent at constant exchange rate, partly due to reduced international travel affecting the duty-free channel and the softening of the US market.

The company’s EBITDA amounted to 252 million euros, down from 299 million euros of FY 2022, with an incidence on revenues of 21.8 percent. EBIT of 72 million euros, decreased 43.7 percent.

Pre-tax profit dropped to 46 million euros and net profit for the period amounted to 26 million euros, a decrease of 59.9 percent, while group net profit declined to 26 million euros.

Ferragamo posts sales decline across most of the markets

The company's Asia Pacific region registered a 13.1 percent or 8.3 percent decrease in net sales at constant exchange rates, while in the fourth quarter net sales at constant exchange rates reported a 2.2 percent growth, with wholesale positive and retail sales in Greater China up double-digit.

The Japanese market in FY 2023 registered a 12.6 percent or 3.7 percent decrease at constant exchange rates, while in the fourth quarter, net sales at constant exchange rates were down 6.5 percent.

EMEA posted an increase of 3.4 percent both at current and constant exchange rates and in the fourth quarter, net sales at constant exchange increased 4.8 percent.

North America recorded a net sales decrease of 19.3 percent or 17 percent at constant exchange rates versus FY22, in a context of general softening of the market. In the fourth quarter, net sales at constant exchange rates were down 14 percent.

Net Sales in Central and South America were down 7.2 percent or 11.5 percent at constant exchange rates and in the fourth quarter, net sales at constant exchange rates decreased 13.1 percent.