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Salvatore Ferragamo posts 17 percent rise in FY16 net profit

As of December 31, 2016, the Salvatore Ferragamo Group reported total revenues of 1,438 million euros (1,529 million dollars), which were up by 1 percent at current exchange but down 2 percent at constant exchange rates over the 1,430 million euros (1,520 million dollars) recorded in FY 2015. Revenues, in the fourth quarter, the company reported a 4 percent growth or 2 percent at constant exchange rates.

The net profit, the company said, including the negative minority interest of 4 million euros (4.2 million dollars), was 198 million euros (210 million dollars), up 14 percent. The Group net profit reached 202 million euros (214 million dollars), up 17 percent against FY15.

Asia-Pacific revenues up 1 percent

Revenue in Asia Pacific area, representing 36 percent of total in FY 2016, was up by 1 percent. In 4Q 2016 the growth was over 4 percent. The positive performance was achieved despite the still weak business in Hong Kong, which remained negative. In 4Q, the retail business registered a decrease of 13 percent at constant exchange rates. The retail channel in China recorded revenue rise of 6 percent at constant exchange in FY 2016, with 13 percent growth at constant exchange in the fourth quarter.

Europe posted a decrease in revenues of 4 percent in FY 2016, while in 4Q, the decrease was 2 percent. North America, the company said, despite the strong currency that also negatively impacted tourist flows in the United States, registered an increase in revenues of over 4 percent or decline of 2 percent at constant exchange in FY16. In 4Q, revenues increased 7 percent or 2 percent at constant exchange owing to 10 percent growth of the retail business.

The Japanese market reported stable revenues in FY 2016, which was up 3 percent in 4Q 2016. Revenues in Central and South America showed an increase of 6 percent in FY 2016, with an acceleration of 12 percent in 4Q. At constant exchange rates, revenues rose 16 percent in FY16 and 23 percent in 4Q 2016.

Revenues by retail distribution channel up 2 percent

As of December 31, 2016, the Group's network totalled 683 points of sale, and 402 directly operated stores (DOS), while the wholesale and travel retail channel included 281 third party operated stores (TPOS), as well as the presence in department stores and high-level multi-brand specialty stores.

In FY 2016 the retail distribution channel posted consolidated revenues up by over 2 percent with 5 percent rise in 4Q 2016. At constant exchange rates, the trend was negative by 1 percent in FY16, but positive by over 2 percent in 4Q 2016.

The wholesale channel delivered a 2 percent decrease in FY16, mainly penalized by the negative performance of the US market, but 4Q showed a positive growth of 3 percent.

Among the product categories, shoes registered revenue rise of 2 percent in FY16, while handbags and leather accessories showed a stable trend. Fragrances reported stable revenues, with a further improvement in 4Q of 11 percent.

In FY16 the gross profit increased 2 percent at 965 million euros (1,025 million dollars), with an incidence on revenues up by 80 basis points to 67.1 percent, from 66.3 percent recorded in FY 2015. The gross operating profit (EBITDA) was stable at 324 million euros (344 million dollars) over the period, with an incidence on revenues of 22.5 percent from 22.7 percent in FY 2015.

The operating profit (EBIT), over the period, decreased 1 percent to 261 million euros (277 million dollars), with an incidence on revenues of 18.1 percent, from 18.5 percent in FY 2015.

Picture:Ferragamo Group website