Tod’s Q1 sales rise 0.1 percent

REPORT_ The Board of Directors of Tod’s has approved the group’s interim report for the first quarter of 2014 (January 1 – March 31, 2014).

Consolidated sales were 253.8 million euros (346.9 million dollars) in the first quarter of 2014, up 0.1 percent from Q1 2013. At constant exchange rates, sales would have been up 2.2 percent from Q1 2013.

Commenting on the development, group’s Chairman and CEO, Diego Della Valle, said, “The results released today are coherent with our expectations and reflect the high sales volatility and the weakness of some key markets for luxury goods, such as the Chinese one. I’m particularly satisfied with the results registered by the Tod’s brand in leather goods.”

As already commented in the past, also Q1 2014 sales results have been impacted by the strategic decision to rationalize the wholesale distribution, mainly on the domestic market, with the goal to preserve the brands’ exclusivity and positioning, but also to improve the already very good quality of the credit portfolio. The rationalization affected all the brands, but it was mainly evident on the results of Hogan and Fay, with the higher exposure to the Italian market and to the wholesale channel. The Tod’s brand registered 3.6 percent growth at constant exchange rates from Q1 2013.

Hogan sales decreased about 7 percent. Revenues of the Fay brand witnessed a 6 percent decrease. Finally, Roger Vivier continued to grow double-digit, confirming to be one of the most prestigious maison of luxury accessories and shoes in the most exclusive segment of luxury goods, worldwide. In the period, its revenues were up 24.2 percent at constant rates from Q1 2013.

Revenues from shoes totaled 195.9 million euros (267.5 million dollars) in Q1 2014, broadly aligned with the value registered in Q1 2013, confirming the undisputed group’s leadership in the core business of shoes. Sales from leather goods and accessories returned to grow, driven by the excellent results of the Tod’s products. Revenues of this category went up 13.9 percent, at constant rates. Finally, sales of apparel were 16.4 million euros (22.4 million dollars); the difference, as compared to Q1 2013, broadly reflects the performance of the Fay brand.

In Q1 2014, domestic sales decreased compared to Q1 2013. In the rest of Europe, revenues grew double-digit at about 12 percent, at constant exchange rates. The performance of the US market was affected by unfavourable weather conditions on the Eastern Coast in the first months of the year. The group’s sales in the Americas went up 1.4 percent at constant exchange rates. Greater China confirmed the slowdown shown last year witnessing 1.5 percent rise at constant exchange rates, and represented 22.1 percent of consolidated turnover as of March 31, 2014. Finally, in rest of the world, sales were up 30.4 percent at constant exchange rates. As of March 31, 2014 the group’s distribution network was composed by 223 DOS and 85 franchised stores, compared to 198 DOS and 79 franchised stores as of March 31, 2013.