Salavatore Ferragamo posts decline in revenue and profit

As of 30 September 2020 the Salvatore Ferragamo Group reported total revenues of 611 million euros, down 38.5 percent at current exchange and 38.6 percent at constant exchange rates. The company said in a statement that revenues in the third quarter decreased 18.9 percent at current exchange rates and 18.1 percent at constant exchange rates.

In the nine-month period, gross profit decreased by 42.9 percent to 368 million euros, while EBITDA decreased by 67.9 percent to 78 million euros, with an incidence on revenues of 12.7 percent from 24.4 percent. Operating profit (EBIT) was negative for 70 million euros, in the third quarter, EBIT was positive for 4 million euros. The company said, profit before taxes in the nine month period was negative for 96 million euros, while net profit for the period was negative for 96 million euros and nine month period net profit was negative for 96 million euros.

Review of Salvatore Ferragamo’s financial performance

In the nine-month period, the company’s retail distribution channel posted consolidated revenue decline of 35.3 percent or 34.8 percent at constant exchange rates, with a decrease of 35.2 percent at constant exchange rates and like-for-like. In the third quarter, retail revenues decreased 23 percent or 20.8 percent at constant exchange rates, with a negative 22.8 percent like-for-like performance. The wholesale channel registered a decrease in revenues of 44.5 percent or 45.6 percent at constant exchange rates in the nine-months and down 8.7 percent or 11.5 percent at constant exchange rates in the third quarter.

Revenues in the Asia Pacific area decreased by 30.6 percent or 30.3 percent at constant exchange rates in the nine-month period, while third quarter revenues were down 4.8 percent at constant exchange rates, recovering from the previous quarter, benefitted from the positive performance of the retail channel in China, which recorded a revenue growth of 38.3 percent at constant exchange rates. The Japanese market registered a 30.9 percent or 31.2 percent at constant exchange decrease in revenues in 9M 2020, with a performance in 3Q 2020 down 17.3 percent or 13.6 percent at constant exchange rates.

Sales in the EMEA during the nine-month period, recorded a decrease in revenues of 45 percent or 44.6 percent at constant exchange, with third quarter sales decline of 30.1 percent at constant exchange rates still strongly penalized by the limited tourists’ flows in the period. North America recorded a revenue decrease of 45.1 percent or 47.5 percent at constant exchange rates in nine months, with third quarter down 24 percent or 23.1 percent at constant exchange rates.

Revenues in the Central and South America were down 47.5 percent or 42 percent at constant exchange rates, with third quarter down 31.9 percent or 24.2 percent at constant exchange rates.

All product categories, at constant exchange rates, reported a decrease in nine-month period against the same period of last year. The fragrances division registered a decrease in revenues of 56.7 percent at constant exchange due to the postponement of the launch of new products as a consequence of the lock-down measures in the global markets.

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