Greater China and North America Boost Salvatore Ferragamo Revenue in H1

MILAN – Business picks up at Salvatore Ferragamo, stimulated by Greater China and North America.

The Florence-based company on Tuesday announced preliminary revenue of 524 million euros in the first six months of this year, up 44.1%, from 363 million euros in the same period. of 2020 – when society, like its peers, was impacted by the consequences of the COVID-19 pandemic. In the second quarter of 2021, sales climbed 91.3% compared to the same period last year.

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Figures exclude the company’s fragrance business, which will be licensed to Inter Parfums Inc. from October, and these are the reclassified discontinued operations.

As stated, the license will be last for an initial period of 10 years and marks a turning point for Ferragamo’s beauty business because its fragrance division has been managed internally for the past two decades. In order to ensure the continuity of Made in Italy production and the highest level of synergies with the fashion house, Inter Parfums will operate through a wholly owned company based in Florence.

Although no conference call with analysts was held on Tuesday, as usual for Ferragamo during preliminary tax reporting, the company said July continues to show solid revenue growth in the directly operated stores in the United States, Greater China and South Korea. and Latin America, compared to 2020 and the same period in 2019. As of the second week of July, global retail performance is in line with pre-COVID-19 levels.

The next call with analysts will take place after Ferragamo’s board meeting on September 7, when the general manager Micaela le Divelec Lemmi will resign, as reported. From this date, all executive powers will be exercised by Vice-President Michele Norsa. Marco gobbetti, who will remain CEO of Burberry until the end of the year, will then succeed Divelec Lemmi as CEO and CEO.

In the first half of the year, the increase in revenue was achieved despite ongoing lockdowns in some countries and international traffic bans and restrictions, caused by the COVID-19 pandemic. As of June 30, the group was operating with 53% of retail stores at full capacity.

At the end of June, the group’s distribution network had 639 points of sale, including 398 own stores.

In the first half of the year, retail sales increased 46.3% to 381.3 million euros, or 72.8% of the total.

In the second quarter, retail revenues grew 81.3%, with China, North America, Latin America and South Korea surpassing pre-COVID-19 levels.

The direct e-commerce channel continues to consolidate solid growth with sales up 70.6%.

The wholesale channel grew by 41.1% to 138.1 million euros, representing 26.4% of the total.

Sales in the Asia-Pacific region increased 35.2% to 222.3 million euros, or 42.4% of the total.

In the first half of the year, the Greater China distribution channel recorded 45% revenue growth at constant exchange rates. In particular, the retail channel in China and South Korea saw sales increase of 47.4% and 22%, respectively, at constant exchange rates.

Revenue in Japan increased 13.4% to 41 million euros, showing a gain of 55% in the second quarter.

Globally, the Asian continent accounts for more than 50 percent of total income.

The Europe, Middle East and Africa region, still penalized by store closures and mainly by limited tourist flows, recorded an increase in revenues of 22.3% to 96 million euros, or 18.3% of the total.

Sales in North America soared 103% to 137 million euros, or 26.1% of the total. In the second quarter, revenues for this region more than quintupled compared to the second quarter of last year.

Revenues in Central and South America in the first half increased 64.8% to 27.4 million euros.

By category, sales of shoes rose 40 percent to 223.2 million euros, accounting for 42.6 percent of total revenue.

Leather goods and handbags increased 48.5% to 235.4 million euros, accounting for 45% of sales.

Ready-to-wear rose 53% to 29.2 million euros, or 5.6% of the total.

Creative Director Paul Andrew left the company in May and no successor has been named so far as the internal team is now in charge of the collections.

Ferragamo has announced that it has renewed its license agreement with Vertime BV for the production and distribution of watches for a period of 10 years, effective January 1, 2023.

The company signed a sustainability loan with UniCredit for a total maximum amount of 80 million euros. The credit facility is structured as a revolving line of credit with a maturity of 2025 and has a reward mechanism linked to specific environmental and social sustainability indicators that will be verified annually. Last year, the company signed a financing line of credit granted by Intesa Sanpaolo SpA for a maximum amount of 250 million euros which was also linked to the achievement of certain sustainability objectives by the luxury brand.

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