Salvatore Ferragamo FY20 sales fall by 33.4 percent

As of December 31, 2020 the Salvatore Ferragamo Group reported total revenues of 916 million euros down 33.5 percent at current exchange and 33.4 percent at constant exchange rates. The company said in a statement that revenues in the fourth quarter, improved over nine months of 2020, registering a 20.4 percent decrease at current exchange and 19.9 percent at constant exchange rates.

Closure of the majority of the group’s store network in several countries and the significant reduction in traffic in the remaining stores, negatively impacted the results of the first six months of the year, that registered a progressive improvement, with alternating phases linked to the second wave of the pandemic and the consequent restrictions, in the second part on the year.

Salvatore Ferragamo posts negative results across retail channels

At the end of 2020, the group’s retail network had a total of 644 points of sales, including 395 directly operated stores (DOS) and 249 third party operated stores (TPOS) in the wholesale and travel retail channel, as well as the presence in department stores and multi-brand specialty stores.

In FY 2020, the retail distribution channel posted consolidated revenues down 29.2 percent or 28.6 percent at constant exchange rates, with a decrease of 29.9 percent at constant exchange and like-for-like, with the primary and secondary channel posting a similar performance. In the fourth quarter, retail revenues decreased 13.7 percent or 13.2 percent at constant exchange, with a negative 16.4 percent like-for-like performance and the contribution of the e-commerce channel registering a strong acceleration of 61.1 percent at constant exchange rates.

The company added that wholesale channel registered a decrease in revenues of 41.7 percent or 42.2 percent at constant exchange, penalized by the performance of the travel retail channel and of fragrances. In the fourth quarter, wholesale revenues were down 33.8 percent or 32.9 percent at constant exchange.

Salvatore Ferragamo’s performance across core markets

Revenues in the Asia Pacific area decreased by 25.5 percent or 25 percent at constant exchange, while in the fourth quarter, sales were down 11.2 percent at constant exchange rates negatively impacted by the performance of the wholesale channel especially of the travel retail, that was mostly affected by the pandemic, while the performance of the retail channel was positive. The retail channel in China, in 4Q 2020, registered a revenue increase of 33.9 percent at constant exchange bringing the FY performance to a positive 11.3 percent at constant exchange rates. Also the Directly Operated Stores in Korea registered a revenue increase, while in Taiwan reported positive 12.9 percent growth in 4Q 2020 at constant exchange rates.

Retail revenues, the company said, were in line with FY 2019, supported by the double-digit increase registered in the second part of 2020 that compensated the negative performance of the first six months. The Japanese market registered a 24.5 percent or 25 decrease in revenues at constant exchange rates in FY 2020, and drop of 6.7 percent at current exchange or 7.4 percent at constant exchange rates in the fourth quarter, benefitting from the positive performance of the retail channel, which was positive 2.9 percent at current exchange rates and 1.3 percent at constant exchange rates.

In FY20, EMEA posted, a decrease in revenues of 42.5 percent or 41.9 percent at constant exchange rates, with 34 percent drop at constant exchange rates in the fourth quarter, still strongly penalized by the stores closures and the lack of tourists’ flows in the period.

North America recorded a revenue decrease of 39.4 percent or 41.4 percent at constant exchange rates in FY20, with fourth quarter sales down 26.6 percent or 27.5 percent at constant exchange rates. Full year revenues in the Central and South America were down 35.6 percent or 29.5 percent at constant exchange rates, with fourth quarter sales down 10.7 percent or 2.5 percent at constant exchange rates.

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