Volatile China market impacts Salvatore Ferragamo's Q1

Salvatore Ferragamo Group’s revenues of 227 million euros were down 18.3 percent at current exchange rates and 16.6 percent at constant exchange rate.

In a statement, the company attributed the negative DTC performance to January trading and a volatile consumer environment in Greater China. The wholesale channel, Ferragamo added, was penalised by a weak environment and a hard comparison base due to a shift in delivery timing versus last year.

Commenting on the first quarter trading, Marco Gobbetti, the company’s chief executive officer and general manager said: “Over the quarter, our performance was impacted by continued volatility in the Chinese market, as well as a persisting weakness in wholesale and travel retail, further compounded by an unfavourable comparison.”

Salvatore Ferragamo reports negative first quarter results

The company’s DTC channel posted a decrease of 11.1 percent or 7.5 percent at constant exchange rates. The overall DTC performance was negative in January, but was in line with last year in February and March, despite weak performances in Greater China and Korea.

The wholesale channel registered a decrease of 38.3 percent or 38.6 percent at constant exchange, reflecting the weak environment and a hard comparison base, mainly in Europe.

Salvatore Ferragamo witnesses negative results across markets

By geography, the EMEA region posted a decrease of 30.8 percent or 31 percent at constant exchange, mainly due to the wholesale business. DTC was up 3.5 percent at constant exchange, while wholesale channel declined by 51.3 percent.

North America recorded a decrease of 10.9 percent or 9.2 percent at constant exchange impacted by a double-digit negative wholesale performance. Net sales in Central and South America were down 8.6 percent or 11 percent at constant exchange, with DTC3 broadly in line with last year, while wholesale was down double-digit.

Asia Pacific registered a 19.3 percent decrease or 15.5 percent at constant exchange as Greater China and Korea, impacted by a weak consumer sentiment, reported a negative performance both in DTC and wholesale, while the rest of Asia Pacific was positive.

The Japanese market registered a 15.7 percent or 4.4 percent decrease at constant exchange rates.