Salvatore Ferragamo Reports Decline in First-Quarter Revenues
Impacted by a weak performance in its wholesale and travel retail channels and lagging sales in China, the Salvatore Ferragamo company reported a decline in first-quarter revenues. Chief executive officer and general manager Marco Gobbetti expressed his confidence in Ferragamo’s new product offer designed by creative director Maximilian Davis and stood by the strategy implemented over the past year.
In the three months ended March 31, revenues of the Florence-based luxury company were down 18.3 percent to 227 million euros compared with 278 million euros in the same period last year.
The direct-to-consumer channel saw a sales decrease of 11.1 percent to 169.8 million euros, while the wholesale channel reported a 38.3 percent decline year-over-year to 50 million euros.
Gobbetti stated, “We are encouraged by the exit rates we are seeing in our DTC performance — most notably in Europe, U.S. and Japan — as we turn to further drive our top-line performance through an increased focus on both customer engagement and communication activities around our refreshed DTC channels.”
He added, “We have almost completed the transition of products and inventory is under control.” Gobbetti confirmed that margins are not expected to deteriorate in the year but may settle slightly below the 72 percent gross margin last year.
As for sales by region, Europe, Middle East, and Africa were down 30.8 percent; North America decreased by 10.9 percent; Asia Pacific saw a 19.3 percent decrease; Japan fell 15.7 percent, and Central and South America were down 8.6 percent.
By category, sales for leather goods fell 18.5 percent, apparel slumped 30.5 percent, and silk products decreased by 17.7 percent.