Ferragamo posts lower financial performance

Worldwide
Published:  16 November, 2016

The Italian luxury fashion house has posted total revenue of €1.01 million, representing a 0.7% drop at current exchange rates and -4% at constant exchange rates, in the first nine months of 2016 over the corresponding period the prior year.

In the third quarter of 2016, revenue totalled €304 million, up 1.7% against the same period in 2015 at current exchange rates, -6.2% at constant exchange rates with a different trend being reported between retail and wholesale business. According to Ferragamo, the retail business was stable in the quarter 2016 (-0.1% at constant exchange rates), while wholesale registered a decrease of 18.6%.

Revenues in Europe were down 5% in the first nine months of 2016 year-on-year “due to lower tourist flows, negatively impacted by the dramatic events”. North America recorded a 3% increase in revenues (-4% at constant exchange rates) in the first nine months of 2016. The retail business, “despite the strong U.S. dollar that negatively impacted tourist flows” in the country, reported sales up 11% in the nine months, while the wholesale business was down 8%.

The Asia Pacific region recorded an improvement in revenues in the third quarter of 2016 (+10%), but these were down 4% in the first nine months at constant exchange rates. Business in Hong Kong is said to have remained negative, while the retail channel in China recorded revenues up 3% at constant exchange rates in the nine-month period, with an acceleration in the third quarter; +11% against the same quarter in 2015.

Among the product categories, shoes registered a 1% increase in revenue in the nine months, while handbags and leather accessories recorded a negative 1%, compared with +11% in the corresponding period of 2015.

In the first nine months of 2016, the brand's gross profit is reported to have increased 1% to €679 million.

Ferragamo’s shares dropped 7.5% to €20.18 in Milan on November 15, giving the company a market value of €3.4 billion.

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