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Safilo's Q1 sales improve 20 percent

By Prachi Singh

May 12, 2021

Management

Carrera website

In the first quarter of 2021, Safilo posted total net sales of 251.4 million euros, up 20 percent at constant exchange and 13.7 percent at current exchange rates.

The company said that the positive sales performance reflected the strong recovery recorded by the group across the brands portfolio, from the strong growth of its own brands Smith and Carrera, to the rebound of its licenses, in particular Hugo Boss, Tommy Hilfiger, Kate Spade and Jimmy Choo.

Commenting on the Q1 performance, Angelo Trocchia, Safilo chief executive officer, said: “We are pleased about this very positive start to the year, which saw our Q1 sales and economic results exceed the first quarter of 2019. Despite a still mixed macro picture in Europe and uncertainty concerning the evolution of the summer season, we are on track to deliver a solid second-quarter, again backed by the strength of the United States, the online business, and by the progress of a number of emerging countries.”

Highlights of Safilo’s first quarter results

The company added that by product and channel, Q1 sales were once more largely driven by the strong growth recorded by prescription frames, and by Smith’s sport products through its D2C and sport channels.

Safilo’s online business grew 164 percent driven by the contribution of Blenders’ e-commerce, up 79 percent, the growth of Smith’s D2C channel, and the group’s sales generated through internet pure players.

In Q1, Safilo’s North America sales totalled 119.1 million euros, up 53.8 percent at constant exchange rates and 41.1 percent at current exchange rates. Total net sales in North America were up 41.8 percent at constant exchange rates compared to Q1 2019.

Safilo’s European sales equalled 101.5 million euros, down 5 percent at constant exchange rates and 5.8 percent at current exchange rates compared to Q1 2020. Net sales in Europe were down 17.8 percent at constant exchange rates compared to Q1 2019.

The group’s sales in China and Australia confirmed the significant growth trajectory recorded in the second half of 2020. In Q1 2021, Safilo’s sales in Asia Pacific equalled 13 million euros, down 10.8 percent at constant exchange rates and 13 percent at current exchange rates compared to Q1 2020. Net sales in Asia Pacific were down 25.3 percent at constant exchange rates compared to Q1 2019.

Safilo’s sales in the rest of the world equalled 17.8 million euros, up 40.6 percent at constant exchange and 26.6 percent at current exchange rates compared to Q1 2020. Net sales in the region were up 26.5 percent at constant exchange rates compared to Q1 2019.

Safilo posts improvement in Q1 operating performance

First quarter gross profit stood at 126.6 million euros, with the margin on sales at 50.4 percent compared to 49.5 percent in Q1 2020 and 52.7 percent in Q1 2019. Reported EBITDA equalled 13.4 million euros, with the margin on sales at 5.3 percent compared to 1.5 percent in Q1 2020 and 7.6 percent in Q1 2019.

On an adjusted basis, gross profit stood at 131.2 million euros, with the margin on sales at 52.2 percent, while the EBITDA equalled 25.8 million euros, marking an increase compared to 5.8 million euros in Q1 2020 and 29.4 percent growth compared to the adjusted EBITDA of 20 million euros recorded in Q1 2019.

The adjusted EBITDA margin rose to 10.3 percent from 2.6 percent in Q1 2020 and 8.1 percent in Q1 2019.

Safilo said, in the month of April, sales trends remained strong, still driven by outstanding growth in the United States, in the online business and by the progress of a number of emerging countries. Retail restrictions and the uncertainties surrounding stores re-openings in some countries instead prevented a material rebound in Europe.

Based on the current visibility on the order book, the group expects its total net sales for the second quarter to normalize compared to the exceptional Covid-19 related decline recorded in the second quarter of last year, aiming to slightly surpass Q2 2019 at constant exchange rates.

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