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Tod’s Q1 sales suffer amid challenging market and low demand

By Prachi Singh

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Business |REPORT

Consolidated sales at Tod’s in the first quarter were 249.6 million euros (284.9 million dollars), down 3.1 percent from Q1 2015. At constant exchange rates, including the related effects of hedging contracts, sales would have been 247.3 million euros (282.4 million dollars), down 4 percent from last year.

“The 2016 first quarter sales figures reflect a challenging market and industry environment, characterized by the sharp decline in tourist flows and weakness in consumption in many important markets for luxury goods. Thanks to the good results of cost control, which will be visible in the next few months, I’m confident that our Group will achieve satisfactory results in the year," commented Diego Della Valle, Chairman and CEO of the Group.

Sales summary by brands and product categories

The Tod’s brand registered 131.8 million euros (150.5 million dollars) in sales in the period; which the company said, was affected by weak consumer spending in Europe, mainly due to lower tourist flows, and in Greater China.

Hogan sales were 67.1 million euros (76.6 million dollars), down 1.5 percent from Q1 2015, also due to the different timing of deliveries. Revenues of the Fay brand were 14.6 million euros (16.6 million dollars), up 2.9 percent due to double-digit growth in the Asian markets, where the brand started its penetration strategy. Finally, Roger Vivier registered 35.7 million euros (40.7 million dollars) in sales, up 8.7 percent from Q1 2015.

Revenues from shoes were 200.4 million euros (228.8 million dollars), slightly lower than in Q1 2015. Sales of leather goods and accessories totalled 32.9 million euros (37.5 million dollars); the figure also reflects the weakness of major markets for sales of leather goods and accessories, such as the Chinese and American ones. Finally, sales of apparel were 16 million euros (18.2 million dollars), broadly flat as compared to Q1 2015.

Domestic sales down 3 percent

In the first quarter, domestic sales were 87 million euros (99.3 million dollars), a 3 percent decrease from Q1 2015. In the rest of Europe, the Group’s revenues totalled 59.1 million euros (67.5 million dollars), with a small increase from Q1 2015, despite the slightly negative results of France and UK. In the Americas sales were down 4.7 percent.

The Group’s revenues in Greater China decreased 9.8 percent due to the weakness in Hong Kong and Taiwan, while sales in mainland China, which represents slightly more than half of this region, were flat. Rest of the World sales were up 1.5 percent from Q1 2015.

As of March 31st , the Group’s distribution network comprised of 260 DOS and 100 franchised stores, compared to 242 DOS and 94 franchised stores as of March 31, 2015.

Image: Tod's Facebook

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