Geox appoints new CEO as yearly sales take hit amid ‘extremely challenging’ period

Footwear specialist Geox has announced the appointment of a new chief executive officer alongside the publication of its financial results for 2023, when it saw sales take a slight hit after navigating an “extremely challenging” period.

Enrico Mistron is to take on the helm position, succeeding Livio Libralesso, who was said to have agreed to a “mutual separation” and step down from the role after what the company said was “years of successful collaboration”.

Libralesso will continue to serve Geox until March 31, 2024, to allow “the best collaboration in the definition and formalisation of the management operations still pending”.

In the meantime, Mistron will assume the CEO role, a position he takes up after serving as chief corporate officer of Italian eyewear conglomerate Luxottica Group for over six years.

Mistron first joined the company in 1995 as corporate finance and later moved through a series of leadership roles to ultimately become responsible for supply chain, sustainability spending and digital transformation at the firm.

Sales fall in North America and Europe

His appointment comes at a time when the sales of Geox took a slight hit, falling 2.2 percent to 720 million euros compared to the year prior, when the company recorded sales of 736 million euros.

Fourth quarter sales, meanwhile, also declined, dropping 17.3 percent to 138 million euros compared to the same period in 2022.

For the year, wholesale accounted for 51.7 percent of the group’s sales, amounting to 371.8 million euros, up 0.6 percent at current exchange rates, while its franchising sales amounted to 60.2 million euros, dropping 5.3 percent. Its directly-operated stores accounted for 40 percent of the sales, reaching 287.5 million euros, down 4.9 percent on the year prior.

In Italy, the brand’s home country, sales rose 3.1 percent, yet in Europe overall, they dropped 7.1 percent, mainly driven by “the negative performance in the German market and specifically in the multi brand channel”. North American sales fell 10.1 percent as opposed to the sales of other countries, which grew 2.4 percent.

Despite the drop in sales, Geox did report that there had been a “significant improvement in operating margin” compared to the year prior, with its EBIT growing from 4.3 million euros to 15.6 million euros. Its gross margin further rose from 47.5 percent to 52.5 percent.

Geox’s EBITDA also saw an increase, hitting 89 million euros compared to its prior 79.4 million euros.

International conflict impacts FY24 outlook

Looking ahead, the company warned that various international tensions that have escalated in recent years – namely the invasion of Ukraine and the Israeli-Palestinian conflict which has further led to disruption on the Red Sea – could lead to “significant negative effects” on demand in international markets, trends in inflation rates, uncertainty surrounding consumption and increased transportation costs, among others.

Geox further noted that its business is mainly operating through third parties, and it may “be considered not material in Ukraine, Israel and Palestine”.

As such, the company said that “the ongoing uncertainty, variability, and complexities of the international macroeconomic environment have a significant impact on the group's business development outlook for 2024”.

With that in mind, Geox added it is taking a “conservative approach” to sales expectations for FY24, forecasting that will broadly fall in line with FY23 while gross margins are expected to improve slightly compared to the previous year.