MILAN — A strong performance in China and the Americas couldn’t offset a drop in revenues in Italy, driving profits and sales at Tod’s SpA down in the first quarter ended March 31.
The luxury goods company said Tuesday that operating profits in the three-month period fell 6.8 percent to 53.4 million euros, or $70.5 million, and earnings before interest, taxes, depreciation and amortization were down 4.6 percent to 63.6 million euros, or $84 million.
The group does not release net profit figures on a quarterly basis.
Revenues of 253.5 million euros, or $334.6 million, represented a 3.7 percent decrease compared with 263.2 million euros, or $344.8 million, in the same period last year.
Dollar amounts have been converted at average exchange rates for the periods to which they refer.
“First-quarter results are in line with our expectations and are a direct consequence of the strategy we decided to adopt, given the current environment,” said chairman and chief executive officer Diego Della Valle, citing “strong prudence in Italy” compared with an international expansion with a focus on the Americas and China. Della Valle touted a coherent growth of the brands, “without damaging their prestige and integrity.” He concluded: “Given the good results of our stores and the orders backlog, I am confident that our group could reach a growth in sales and profit also in the current year.”
The company said that first-quarter sales were “significantly influenced” by the group’s strategic decision to rationalize wholesale distribution, mainly in Italy, in light of “its challenging situation. The primary goal of this decision, which was started last year, was to maintain the quality of the credit portfolio, but also to preserve the brands’ exclusivity and positioning.” This mainly affected the Hogan and Fay brands, more present in Italy and at wholesale.
In the first quarter, sales of the Tod’s brand were up 3 percent to 141.6 million euros, or $187 million.
Hogan sales were down 21 percent to 70.8 million euros, or $93.4 million. Fay was down 35.2 percent to 14.9 million euros, or $19.6 million. Roger Vivier sales more than doubled to 26 million euros, or $34.3 million, compared with 12.9 million euros, or $16.9 million, in the same period last year.
In terms of categories, sales of footwear, the group’s core business, was up 1.2 percent to 198.2 million euros, or $261.6 million. Leather goods and accessories revenues decreased 5.5 percent to 37.7 million euros, or $49.7 million, a drop the company attributed to the impact of the rationalization implemented in the wholesale channel. Sales of apparel were down 36.4 percent to 17.3 million euros, or $22.8 million, reflecting the performance of the Fay brand.
Sales in Italy dropped 26.7 percent to 98.9 million euros, or $130 million. Europe also suffered, showing a 3.8 percent decrease to 50.4 million euros, or $66.5 million.
In the Americas, sales were up 31 percent to 19.4 million euros, or $25.6 million.
The company touted “outstanding growth” in Greater China, which was up 55.4 percent to 57.2 million euros, or $75.5 million, accounting for 22.5 percent of total sales in the quarter.
In the Rest of the World area, sales were up 13.5 percent to 27.6 million euros, or $36.4 million.
In the first quarter, the group invested a total of 9.4 million euros, or $12.4 million, in tangible and intangible fixed assets, compared with 14.7 million euros, or $19.2 million, in the same period last year, mainly aimed at the expansion and refurbishment of the retail network and the update of industrial and production structures, as well as the development of the company’s software.
EXCLUSIVE: @tomford is opening its first-ever beauty store. The boutique, which opens November 20 in London’s Covent Gardens, was designed with the over-the-top glam Ford is known for. Read the full story on WWD.com, link in bio. #wwdbeauty #wwdnews (📷: Simon Wagner) #TomFordBeauty
New York-based DJ @harleyvnewton threw a party to celebrate the holiday collection of her dress and pajama line @hvn at the Ladurée Beverly Hills. It Girls @katebosworth, @rashidajones and more joined in on the fun, which included cocktails, croque monsieur sandwiches and a photo booth. #wwdfashion (📷: Owen Kolasinski/BFA.com)
For the holidays, @Burberry partnered with 20-year-old artist @blondeymccoy on a series of three outdoor murals in downtown Manhattan. The murals are McCoy’s interpretation of a Christmas eve party, the idea of charity and the spirit of family. His third mural, pictured here, is the most personal. The image depicts McCoy’s grandparents and father in London’s Trafalgar Square in the Seventies. “My work often features lots of sentimental objects.” #wwdeye
For spring 2018, designers applied bold colors and cartoonish motifs on everything from sneakers and belts to key chains. See all the top men’s accessories trends on WWD.com. #wwdtrends (📷: George Chinsee; Prop Styling by @rnasti; Market Editor: @luiscampuzano)
The @dior-sponsored @guggenheim international gala pre-party has a history of drawing cool-girl musical acts to serenade the crowd –– and last night was no exception. @haimtheband performed songs both new and old, and lured a star-studded audience with the likes of Rebecca Hall, Kate Mara, Mamoudou Athie and more. #wwdeye (📷: @lexieblacklock)
In a partnership between the @metopera and the @englishnationalopera, “Marnie” was born. The opera, with costumes sponsored by @mrporterlive, is an adaptation of the 1961 thriller by Winston Graham. Arianne Phillips, who created the costumes, is no rookie: She’s styled Madonna for her tours and created costumes for a myriad of films in the past. Read WWD’s interview with Phillips, where she talks about her inspiration for the opera’s costumes on WWD.com #wwdfashion
@barneysnyc took a different approach to their holiday windows this year. Instead of Christmas decor, Barneys tapped @thehaasbrothers to tell a story of positivity, gratitude and inclusivity via heartwarming silliness and humor. “It’s about kids and it’s about coming together and being family and loving each other,” said Simon Haas. #wwdfashion (📷: @joshuascottphoto)
Beauty influencer @kandeejohnson makes her foray into hair care with a collaboration with @ogx_beauty — making it the first time that OGX has teamed up for a product creation. The collab includes shampoos and conditioners in three scents. At 39 and a mom, Johnson is a different profile than the emerging social media stars, but is considered one of the pioneers of the digital beauty influencer world. Read WWD’s interview with her on wwd.com, including the strangest beauty product she’s ever tried #wwdbeauty