MILAN — Shares of Italy’s Safilo Group SpA fell to their lowest-ever level on the Milan Bourse Thursday, a day after the company revised down its full-year outlook after the declining dollar and a weak performance in Europe reduced second-quarter earnings by more than a third.
Safilo’s stock dropped 16.1 percent to 97 cents euro, or $1.51 at current exchange.
On Wednesday, the eyewear company, which has licenses with Giorgio Armani, Dior, Gucci and Valentino, among others, cut its revenue growth forecast to 4 percent, from 7 to 8 percent at constant exchange, and adjusted the net income target to 3 to 3.5 percent of sales, from 4.5 to 5 percent.
The group also said it now expects earnings before interest, taxes, depreciation and amortization to reach 13.5 to 14 percent of revenues, compared with a previous estimate of around 15 percent.
Net profits slumped nearly 37 percent — for the second consecutive quarter — to 7.9 million euros, or $12.4 million at average exchange, while sales dipped 4.7 percent to 310.9 million euros, or $486 million. At constant exchange, revenues gained 1.8 percent.
The figures missed analysts’ estimates and led to a swath of downgrades, with investors losing confidence.
“The first half of the year was characterized by strong volatility in consumer patterns, above all in Europe, our reference market,” Safilo vice chairman and chief executive officer Massimiliano Tabacchi said. “We believe that the European market will continue to remain weak, even in the upcoming months, and we are therefore looking to the second half of the year with greater caution.”
Sales in Europe fell 6.9 percent to 152.3 million euros, or $238.1 million, with Spain, the U.K. and Germany again hit by a slowdown in consumer spending. The company noted Italy registered half-yearly results in line with the first six months of the previous year, thanks above all to the strong performance of the Carrera sunglasses collections. These declines were compensated for, in part, by gains in Asia Pacific — notably China and South Korea — where second-quarter sales gained 14.6 percent to 44 million euros, or $68.7 million, following the opening of two directly operated stores, dedicated principally to prescription eyewear sales.
Revenues in the Americas fell 3.3 percent to 106.4 million euros, or $166.3 million, although Safilo noted sales in dollars — which represent 40 percent of the company’s business — had been penalized by the negative impact of the currency’s 15 percent slide against the euro in the first six months of this year.
“In the American market, we continue instead to achieve significant results,” Tabacchi said.
Tabacchi added he expected Gucci Group to renew its contract with Safilo “as soon as possible,” dampening speculation the eyewear company could lose the deal to Luxottica Group SpA — stemming from the loss of the Stella McCartney license to Luxottica in April.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast