MILAN — Especially weak watch and jewelry sales pushed Bulgari’s preliminary second-quarter revenue down 6.1 percent to $178.80 million, below some analyst expectations.
Goldman Sachs had forecast a 4 percent sales slide, while Morgan Stanley had seen sales dropping by 5.5 percent.
Bulgari also scaled back expectations for full-year profits and sales.
Achieving “the initial expectations for the entire 2002 is becoming more difficult,” chief executive officer Francesco Trapani said in a statement, citing the ongoing crises in financial markets and growing tensions in the Mideast.
This month, Trapani told WWD it was reasonable to expect 2002 net profit growth to come in at 10 to 11 percent — an estimate that was already below some analyst forecasts for a rise closer to 20 percent. At that time, Trapani said 2002 sales growth should come in at about 5 percent.
“Sales for the second quarter are basically in line with this year’s first-quarter and with our expectations, and were once again penalized by a negative economic environment, by a decrease in travel and by a general uncertainty of the international political situation,” Trapani stated.
In the second-quarter, watch sales narrowed their slide to 13.6 percent from a drop of 29.2 percent in the first quarter to $65.97 million, or 36.9 percent of sales.
Dollar figures have been converted from the euro at the current exchange rate.
Jewelry sales dropped 8.1 percent in the quarter to $67.94 million (69.08 million euro).
Sales for the quarter fell in nearly every geographic market, with the U.S. showing the biggest drop of 16.9 percent. Sales in Italy fell 2.1 percent, while the rest of Europe fell 5.1 percent. Japan and the rest of the Far East dropped 1.2 percent and 12.8 percent, respectively. The one bright spot: Sales in the Mideast and elsewhere in the world rose 12.4 percent.
For the first half, Bulgari’s revenue dropped 5.7 percent to $332.42 million from $353.08 million the year before.
Full first-half results, including profit, will be released Sept. 13.
This story first appeared in the August 1, 2002 issue of WWD. Subscribe Today.