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Fourth quarter growth boosts Ferragamo

Feb 18, 2017 Italy
Fourth quarter growth boosts Ferragamo
The Italy-based luxury brand reported revenue of 1.4 billion euros in 2016, a 1% increase on the previous year at current exchange rates (revenue down by 2% in constant rates)
Revenue in the fourth quarter confirmed the improved trend, with a reported 4% growth (+1% at constant exchange rates). The positive development continues to be confirmed by further acceleration of the retail channel sales in January 2017.

The Asia Pacific area was confirmed as the group's top market in terms of revenue, representing 36% of total in financial year 2016, up by 1%. In the fourth quarter growth was over 4%, despite the hard comparison base (+8% in 4Q 2015). The positive performance was achieved despite the still weak business in Hong Kong which remained negative. The retail channel in China recorded revenue up by 6% at constant exchange rates in financial year 2016, with an acceleration in the fourth quarter (+13 % constant exchange rates vs+3% in the first nine months of 2016). 

Europe posted a 4% decrease in revenue in 2016, penalized by lower tourist flows due to the dramatic events occurred. North America, despite the strong currency that also negatively impacted tourist flows in the United States, registered an increase in revenues of over 4% (-2% at constant exchange rates). The Japanese market reported stable revenues in the year, but up by 3% in the fourth quarter. Revenue in Central and South America showed an increase of 6% in the year, with an acceleration in the last quarter of 2016 (+12%).

Among the product categories, shoes registered revenue up by 2% in financial 2016, while handbags and leather accessories showed a stable trend vs. a hard comparison base (+12% in the previous financial year). Fragrances reported stable revenues.

As of the 31st of December 2016, the Group's network totalled 683 points of sale, and could count on 402 Directly Operated Stores (DOS), while the Wholesale and Travel Retail channel included 281 Third Party Operated Stores (TPOS), as well as the presence in Department Stores and high-level multi-brand Specialty Stores.

In financial year 2016 the retail distribution channel posted consolidated revenue up by over 2% (+5% in the last quarter). At constant exchange rates the trend was negative by 1% in the year, but positive by over 2% in the fourth quarter. The wholesale channel delivered in financial year a 2% decrease, mainly penalized by the negative performance of the US market, but with a positive trend (+3%) in quarter four.

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