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Owner of Havaianas posts a profit decline in the second quarter

Aug 11, 2022 Brazil
Owner of Havaianas posts a profit decline in the second quarter
The Brazilian Alpargatas announced its second quarter results for 2022. While Havaianas performed well at home, it posted difficulties internationally, especially in the US and China
In the second quarter of 2022, Alpargatas' net revenue totalled 1.06 billion Brazilian reais (206.3 million US dollars), up by 1.9% (by 10% in cc), on a comparable basis to the same period of last year.

The company's net income declined by 40% in the second quarter of the current fiscal year, reaching 64.2 million Brazilian reais (12.4 million US dollars), as compared to 105.6 million Brazilian reais (20.5 million US dollars) in similar period of the prior year. Excluding data from Rothy’s, whose 49.9% acquisition occurred in the past December, net income decreased by 6.4% to 114 million Brazilian reais (22.1 million US dollars).

Havaianas

In the second quarter of fiscal 2022, the brand's net revenue reached 1.04 billion Brazilian reais (202.4 million US dollars), reflecting an increase of 1% (9% in cc), on a comparable basis to the same period of 2021. The company noted that "the positive effect of the RGM for Havaianas Brazil and international markets is noteworthy, with an increase of 4% (12% in cc) in revenue per pair vs. 2Q21".

Havaianas' net revenue in the domestic market increased by 19% in this quarter, "leveraged by RGM initiatives, reflecting an increase in the revenue per pair of 21% over the second quarter of 2021".

Outside Brazil, the brand's net revenue, which accounts for 41% of total revenue, amounted to 88 million US dollars (433 million Brazilian reais) in this period, down by 16% (by 2% cc), on a comparable basis to the same period of the prior year, thanks to the impact of the exchange rate devaluation.

In the EMEA region, net revenue dropped by 14% due to the exchange rate devaluation, but it grew by 5% in constant currency, driven by a 5% revenue growth per pair, as compared to the second quarter of last year. The company added that this growth was due to the product and channel mix with increased DTC physical stores and consequently, higher full-price product sales. In the US, net revenue fell by 29% (by 23% in cc), due to the volume drop of 36% (about 400 000 pairs), partially offset by the increase in prices. The Chinese market was impacted by the COVID-19-related restrictions, recording a volume drop of 40% (about 100 000 pairs).  

Rothy's

Rothy's net revenue amounted to 59 million US dollars in the second quarter of the current fiscal year, which reflects an 82% increase, as compared to the similar period of 2021. Alpargatas highlighted the contribution of "the intensification of marketing investments which began at the end of March, generating increased traffic and an improved conversion rate in e-commerce" and the advance of its brand marketing plan "with the launch of the new campaign in May/22, which brought positive brand awareness results, contributing to a reduction in customer acquisition costs".


Image Credits: nit.pt

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