Despite the drop in revenue, the group reported an increase in gross profit margin to 72.6 percent of revenue, up from 72 percent a year earlier. However, operating profit (EBIT) plummeted 43.7 percent to 72 million euros (approximately $78.7 million), largely due to increased investments in marketing and communication efforts. Gross operating profit (EBITDA) also saw a decline, falling 15.8 percent to 252 million euros (approximately $275.5 million).
Salvatore Ferragamo's revenue fell to 1.156 billion euros in FY23, a year-on-year decline of 7.6 percent, amid declines in retail and wholesale channels. Despite an increase in gross profit margin to 72.6 percent, operating profit fell by 43.7 percent to 72 million euros. Geographically, sales fell in Asia Pacific and North America, but EMEA saw a 3.4 percent increase.
Geographic performance varied: Asia Pacific region witnessed a 13.1 percent decline in net sales, although it showed signs of recovery in the fourth quarter (Q4) of FY23 with a positive trend of 2.2 percent at constant exchange rates. The Japanese market faced a 12.6 percent decline in net sales for the year, with Q4FY23 sales falling 6.5 percent. In contrast, the Europe, Middle East and Africa (EMEA) region bucked the trend with a 3.4 percent increase in net sales. North America, Central America and South America experienced significant sales declines of 19.3 percent and 7.2 percent, respectively, reflecting broader market weakening and strategic perimeter reductions.
“In 2023 we are making good progress on our strategic priorities in terms of brand, product, communication and network. We improve the quality of sales and invest to strengthen the brand while driving engagement and have seen some successful results with new products. The Fall-Winter '24 show held in February, together with the opening of the women's boutique in Milan under the new store concept, obtained excellent resonance and visibility,” he said Marco Gobbetti, CEO and CEO.
Fiber2Fashion News Desk (DP)
