MILAN — Gains in all geographic markets, led by China, and the performance of its handbags, leather and footwear categories helped Salvatore Ferragamo SpA boost net profits by 41 percent in the first nine months of the year.
Net profits rose to 120 million euros, or $157.2 million, including 7 million euros, or $9.2 million, of minority interest. This compares with a net profit of 85 million euros, or $108.8 million, in the same period last year.
Revenues grew 10 percent to 915 million euros, or $1.19 billion, compared with 833 million euros, or $1.06 billion, last year.
Dollar amounts have been converted at average exchange rates for the periods to which they refer.
Sales in Europe rose 11.5 percent to 246.7 million euros, or $323.1 million, accounting for 27 percent of the total, boosted by tourist flows, said chief executive officer Michele Norsa during a conference call with analysts. He noted “a constant increase in average ticket in the U.S. and Europe boosted by newcomers such as Africans, Russians and Arabs.”
North America grew 13.8 percent to 204.5 million euros, or $267.9 million, accounting for 22.4 percent of sales. “The U.S. keeps being strong, and we are positive over the next months,” said Norsa
The Asia-Pacific area remained the group’s engine, growing 13.6 percent to 337.5 million euros, or $442.1 million, accounting for 36.9 percent of the total. The retail channel in China was “a major contribution,” recording revenue growth of more than 20 percent.
“Traffic to Hong Kong, Macau and Singapore was extremely strong, and the increase of visas to the U.S. and Europe” also helped boost sales to Chinese tourists, Norsa said.
Norsa said growth is coming “more from second- and third- tier cities where the company’s exposure has even increased,” acknowledging “softness in Shanghai and Beijing,” and pointing to “even bigger growth from western China.” He concluded that “a presence in a large number of cities is winning versus competitors that are [primarily] in big cities.”
Japan showed a 13.3 percent decrease at current exchange, but grew 1.7 percent at constant exchange. “Consumer confidence in Japan has improved and will even more over the next few months,” he said. Ferragamo increased prices “close to double digits” in Japan “to recover the devaluation of the yen,” Norsa added. The company is also hiking prices by midsingle digits in Europe and in U.S. dollar-based countries, as well as in Australia, India and Brazil to compensate for the devaluation of currencies.
In the first nine months, Central and South America gained 14.1 percent.
Globally, the retail channel grew 8.2 percent to 576.1 million euros, or $754.7 million, accounting for 63 percent of sales. Wholesale grew 12.7 percent and accounted for 35.3 percent of the total. “In the U.S., retail was bigger in the third quarter compared with wholesale,” noted Norsa.
By product category, footwear rose 9.6 percent to 399.2 million euros, or $523 million; handbags and leather accessories rose 16.2 percent to 300.3 million euros, or $393.3 million; fragrances climbed 9.7 percent, and apparel dropped 4.2 percent.
The company said “the business trend, recorded in the first nine months of the current year, justifies expectations for growth also throughout 2013 both for revenue and net profit, in the absence of severely unfavorable market conditions.” Norsa said Ferragamo had seen “consistent growth in the nine months” and that he expected the same for next month, after describing October as “a good month.”
@margotrobbie steps out onto the red carpet wearing @miumiu. The actress is nominated for “Outstanding Performance by a Female Actor in a Leading Role” in “I, Tonya” at the #SagAwards. (📷: Stewart Cook) #wwdfashion
For @massimogiorgetti of @msgm, the Nineties are his favorite decade. “They had a huge impact on my personal growth. What I like of the Nineties is that they are not so precise in terms of style as other decades…there was actually a bit of everything,” he said. As seen on MSGM’s Spring 2018 show: tie-dye and a bit of grunge, two styles that are synonymous with the decade #wwdfashion #wwddecades (📷: @kukukuba)
Breaking News: @hedislimane joins @celine as its new artistic, creative and image director. One of fashion’s preeminent image-makers and trendsetters, Slimane is to join the LVMH brand on Feb. 1 and unveil his first fashion proposition for men and women next September during Paris Fashion Week. It marks a major homecoming for Slimane, who cemented his reputation – and influenced men’s tailoring for more than a decade – as the designer of Dior Homme between 2000 and 2007. He went on to reinvent and ignite the house of Yves Saint Laurent, which he rechristened Saint Laurent, between 2012 and 2016 – all the while maintaining a close relationship with the Arnault family, which controls LVMH and Dior. Read the full exclusive story on WWD.com. Link in bio. #wwdnews #wwdfashion
“Personally I believe the Eighties have been the richest and more vivacious period for international fashion,” Giorgio Armani said when asked what his favorite decade of fashion is. It was a moment of disruption and experimentation and only thinking back to the first years of that decade is always an emotion for me, for what they have meant to me and my work.” The influence is clear in @giorgioarmani spring 2018 collection, pictured here, which was full of bright colors and unexpected prints. Read more about which decades designers loved most on WWD.com #wwdfashion #wwddecades (📷: @aitorrosasphoto)
For Lady Gaga’s only Italian show on her “Joanne World Tour,” the singer wore a range of @versace_official outfits. The standout piece: this custom-made bodysuit inspired by the brand’s spring 2018 collection. #wwdfashion (RG: @ladygaga)
@_camillaruth_ is expanding on the wellness-craze concept with @westbourne – a new NYC restaurant that’s both a healthy-minded café as well as a business that gives back to the community. Marcus works with the Robin Hood foundation to give back to The Door, a non-profit providing youth development services, and also hires employees through The Door. Read our full interview with Marcus on giving back through food on WWD.com. #wwdeye (📷: @lexieblacklock)