Safilo expects to report 11 to 13 percent drop in Q1 sales

Safilo Group S.p.A. has announced that the extraordinary circumstances after Covid-19 outbreak are having direct and indirect repercussions on the company’s economic activity, resulting in negative effects for the group’s sales and earnings performance which are today impossible to predict for the full year. As a consequence, the company has withdrawn 2020 outlook provided on December 10, 2019. As for the Group’s business development in the first quarter of the year, Safilo added that based on preliminary data, its net sales are expected to decline by 11 percent to 13 percent at constant exchange rates compared to the same quarter of 2019.

“On the demand side, in the first two months of 2020 Safilo recorded a positive mid-single digit increase in net sales, which was nevertheless expected to flatten out by the end of Q1, based on the preliminary data and information collected early March, after the outbreak of Covid-19 escalated in Italy, while only initial signs were experienced across Europe and in the US. From mid-March, the spread of coronavirus escalated also across Europe and the United States, with the most severe measures of national lockdowns and shutdowns of activities implemented in the last two weeks of March,” the company said in a statement.

Safilo added that it was not significantly impacted on the supply side as sufficient stock levels at the end of 2019 granted the group the flexibility to face the temporary shutdown of its Chinese plant in Suzhou and the difficulties encountered by Chinese suppliers during January and February. Since then, the company further said, the Chinese plant has reopened and is working at almost full capacity, while most of the key Chinese suppliers are also back to normal activity levels.

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