World Footwear


Ferragamo with declining revenue

Apr 6, 2018 Italy
Ferragamo with declining revenue
The Italy-based luxury group announced its preliminary 2017 financial results. Revenue for the year totaled 1.393 billion euros, declining by 3.1% from the previous year 
The Salvatore Ferragamo group reported total revenue of 1.393 billion euros in 2017, down by 3.1% at current exchange rates (-1.4% at constant exchange rates) over the 1.438 billion euros recorded in the previous financial year.

Revenue in the fourth quarter registered a 8.4% decrease, penalized by the currencies trend (-5.1% at constant exchange rates) and by the lower incidence of promotional sales in the primary channel as compared to the prior year, thanks to the optimization of the stock.

Distribution channel

By the end of the year the group's retail network counted on a total of 685 points of sales, including 410 Directly Operated Stores (DOS) and 275 Third Party Operated Stores (TPOS) in the Wholesale and Travel Retail channel, as well as the presence in Department Stores and high-level multi-brand Specialty Stores. In 2017 the Retail distribution channel posted consolidated revenue down by 0.8% (+1.3% at constant exchange rates), with a decrease of -1.7% at constant exchange rates and perimeter (like-for-like). The Wholesale channel, penalized by the destocking activity, the political tensions in South Korea and the strategic rationalization in Japan, registered a decrease in revenue of 7.4%at current exchange rates (-6.2% at constant exchange rates).

Geographical area

The Asia Pacific area was confirmed as the group's top market in terms of revenue, decreasing by 2.1% (-0.4%at constant exchange rates). The retail channel in China continued to record a solid Revenue growth of 2.5%(+7.0%at constant exchange rates2) in FY2017. Hong Kong performance improved in the last quarter of 2017, while South Korea continued to show a weak trend, mostly due to the significant decrease of Chinese tourists.
Europe posted a decrease in Revenues of 3.6% (-3.0%at constant exchange rates) compared to the previous year, with a positive performance for the retail channel and a negative trend for the wholesale business, negatively impacted by the destocking activity.
North America
recorded a revenue decline of 4.2% (-2.2% at constant exchange rates), also negatively impacted by the department stores sales.
The Japanese market registered a 5.6% decrease (-3.1% at constant exchange rates), due to the strategic rationalization of the wholesale channel, while the retail stores recorded a positive performance at constant exchange rates.
Revenue in Central and South America grew by 2.0% (+6.5% at constant exchange rates), despite the earthquake in Mexico in September.

Product category

Among the product categories, at constant exchange rates, footwear posted a decrease of 1.7%, and handbags and leather accessories of 0.8%, while fragrances registered a 2.2%increase.

Net Profit

The group net profit totaled 119 million euros in 2017, compared to 202 million euros in the previous financial year, marking a decrease of 41.3%.

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