Salvatore Ferragamo announced on Thursday total revenues of EUR 278 million (USD 307 million) down 4 percent for the first quarter ending March 31, on the back of a double-digit decline in Asia-Pacific sales and a dip in Japan revenues.
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Ferragamo Asia Pacific registered a 13.6 percent decrease in net sales to EUR 90.8 million, compared to the prior-year quarter, hurt by the travel retail channel, while the performance of retail in Greater China was “positive,” said the luxury Italian brand.
Meanwhile, Ferragamo’s Japanese market registered a 7.1 percent decrease in net sales to EUR 23.7 million.
By channel, Ferragamo’s retail distribution channel posted a 2.3 percent decrease in net sales hurt by a softening U.S, market, partially offset by a positive performance in EMEA and a progressively improving trend in China, with Mainland Chinese customers also driving the recovery in Hong Kong.
Ferragamo’s wholesale channel registered a 13.9 percent decrease, due to the planned rationalisation of its third parties’ network, mainly in the US, and the delayed recovery of travel retail in Asia Pacific.
“At the end of February, the first products designed by our new creative Director, Maximilian Davis, arrived in our stores. While these represent a small portion of the overall intended collection, they are an important next step in the execution of our stated strategy of creating a new offering that is relevant for our customer aspirations and we are pleased by the early results,” said Marco Gobbetti, chief executive officer and general manager.
“As the roll out of new products is at its early stages, it has not yet contributed meaningfully to the sales performance. It will not be until later in the calendar year that we will start to see the fuller appreciation of the more complete collection. We are also pleased by the positive resonance and visibility of our initial marketing efforts. As we move further into the year, new marketing activities and a higher share of new products will be engines for growth and increased store efficiency. At the same time, we continue to invest in our business and make the critical choices to rationalize and elevate our wholesale channels, in time for the full collection to showcase the complete perspective and ambition of our work. Whilst there remains work to do, we are confident in our plans and confirm our mid-term ambition.”