MILAN — Tod’s efforts to make its women’s collections more fashion-oriented — and so catch new potential consumers — have not worked as well as hoped for and the brand will return to its roots, concentrating on luxury, high-quality, leather goods that evoke the Italian lifestyle.

This was one of the messages that Emilio Macellari — chief financial officer of Tod’s Group SpA, which includes the Tod’s, Hogan, Fay and Rover Vivier brands — drove home during a conference call with analysts after the company published disappointing first-quarter sales Wednesday.

During the call, Macellari said that the move to make Tod’s more “fashion-oriented,” spearheaded by recently departed creative director of women’s collections Alessandra Facchinetti, left traditional Tod’s customers “disoriented.”

The increased investments required to pursue this strategy also had a significant impact on the company’s profitability, Macellari said, as it led to higher costs. “The fee of the designer is expensive, the expenses related to the collections and the fashion shows are particularly high,” Macellari said, answering an analyst’s questions on the impact of the strategy.

He pointed out that before the arrival of Facchinetti some three years ago, Tod’s had an earnings before interest, taxes, depreciation and amortization margin “in the range of 24 percent” which dropped to 19.5 percent at the end of 2015. “That means a visible reduction in profitability, mostly due to this strategy.”

Facchinetti’s departure from Tod’s was announced on May 5 and on May 6 WWD reported that Andrea Incontri — already the director of Tod’s men’s wear since 2014 — could be tapped to become the creative director also of women’s collections.

Macellari didn’t give any hints on who could replace Facchinetti, saying only that the company was considering its options: “Now the idea is that we can make a different choice in terms of who can be the responsible for the product and style department of the company, who will coordinate the teamwork that we are doing with our internal resources and the focus will be — as I said before — mainly drive on accessories, leather goods, shoes, even with some apparel, because we are not giving up on idea that lifestyle means also apparel but we want to avoid to be too exposed to fashion — to be too fashion-oriented — and to be more focused on leather goods and accessories.”

The finance chief reminded that the company knew it was placing a long-term bet with its push into women’s fashion: “As we commented when we explained the strategy, we said we expected some benefit from this activity after 5-6 seasons and if not we will be ready to be coherent with the strategy.”

In the first quarter, Tod’s Group reported total revenues of 249.6 million euro, or $274.56 million, down 3.1 percent at current exchange rates or 4 percent at constant currencies.

Sales declined in all product categories, with the steepest drop in leather goods and accessories — down 11.1 percent at current exchange, to 32.9 million euro, or $36.2 million; down 12.4 percent at constant currencies — the second-largest product category after footwear, where sales dropped 2 percent — at current exchange; down 2.8 percent at constant currencies — to 200.4 million euro, or $220.44 million. Revenues from apparel remained essentially stable at 16 million euro, or $17.6 million.

From a retail perspective company was looking to open about 10 to 15 new stores for the full year — although the net number, after closing underperforming stores, could be a bit lower — with four net new openings already in the first quarter.

On a wholesale level, things were better. “As far as wholesale, we are everything but worried,” the finance chief said. “We don’t see particular reasons to be concerned, the order backlog as far as fall season is concerned is positive, and this is a particularly good signal.”

Weakness in the first quarter and in the first weeks of the second quarter means that reaching consensus full-year top-line growth of 4 percent and an EBITDA margin “in the region” of 25 percent “now appears a bit challenging,” Macellari said. “I don’t want to say it’s impossible, but when we last said consensus was achievable we had in front of us a more comfortable situation than we do today. So basically it is a bit challenging, because the first half of the year is tougher than expected, but we have good expectations for the second half.”

There were significant bright spots in the first quarter. For example, Macellari said that some products, including the Wave and Double-T bags, were doing very well in stores and that the main problem was having enough in shops to meet demand. Once again, however, he pointed out the weakness of the more fashion-oriented products, like “trendy” variations of some bags, which “make the product fresher and more fashion, but these — it’s really evident — disoriented clients, who didn’t pick them up. So basically what is selling best is what is most iconic, high quality, more discreet, less speaking-out-loud kind of product.”

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