MILAN — Bulgari SpA may be celebrating its 125th anniversary, but the financial markets have little respect for their elders.
This story first appeared in the May 22, 2009 issue of WWD. Subscribe Today.
Bulgari’s share price fell 5.2 percent on the Milan Bourse on Thursday after Credit Suisse cut its 2009 and 2010 EBIT forecasts for the Italian jeweler by 30 and 13 percent, respectively.
“Visibility is poor given lingering uncertainty over underlying demand trends and how long the wide divergence between retail and wholesale will last,” Credit Suisse analyst Rogerio Fujimori stated. “The demand picture may not be getting worse versus the first quarter, but [it] does not seem to be getting much better either.”
Credit Suisse maintained an underperform rating on the stock, which closed at 3.74 euros, or $5.12, on Thursday.
Last week, Bulgari reported first-quarter losses of 29.3 million euros, or $38.3 million, from net profits of 22.8 million euros, or $34.2 million, in the first three months of 2008. Revenues fell 23 percent to 178.1 million euros, or $233 million.
Dollar figures were converted at average exchange rates for the periods to which they refer.
The company, which is cutting jobs, reducing the number of products and closing unprofitable stores, attributed the slump to the financial crisis and “the strong destocking activity in the wholesale channel, [which] has significantly penalized” performance — although it noted sales in directly owned stores improved in April.