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Tod's closes the year with sales down by 30.4%

Feb 19, 2021 Italy
Tod's closes the year with sales down by 30.4%
In fiscal year 2020, Tod's consolidated sales totaled 637.2 million euros, down by 30.4% from 2019. In the fourth quarter of 2020, sales amounted to 184.5 million euros, down by 22.6%. China is already growing in double digits
“The results for the fourth quarter show a strong unevenness in the various areas of the world: China continued to grow in double digits, while the Western world, after a modest improvement in October, suffered a further slowdown due to further lockdowns imposed by local governments to deal with the flare-up of infections. We are satisfied with the results achieved in the e-commerce channel, which recorded a gradual acceleration during the year and achieved revenues that are in the highest range of our expectations. This confirms the strong interest from our customers in our products (...) Our primary goal is to consolidate our communication strategy, particularly the digital one. We are well advanced; when the markets return to normal, we will be ready to begin a lasting growth cycle", commented Diego Della Valle, Chairman and CEO of the Group.

In fiscal year 2020, Tod's consolidated sales totaled 637.2 million euros, down by 30.4% from 2019. In the fourth quarter of 2020, sales amounted to 184.5 million euros, down by 22.6% from Q4 2019. In the current year, the impact of currency fluctuations is slightly negative and is more visible on the Tod’s and Roger Vivier brands, which have the greatest presence abroad; at constant exchange rates, meaning by using FY 2019 average exchange rates, including the related effects of hedging contracts, sales would have been 640.1 million euros (-30.1%). Biggest decline in sales was reported by Tod's brand (35.6%), followed close by Fay (-33.3%) and Hogan (-28.0%). Roger Vivier posted the smallest drop (-20.2%).

In the fourth quarter sales results were heavily affected by the pandemic situation and are very uneven by geographical area. In Mainland China the performance was definitely positive and revenues recorded solid double-digit growth, gradually accelerating, while the results of Europe and the USA were impacted by the closures imposed by the lockdowns and by the very low traffic even during the opening periods, given the absence of tourist purchases. For the total of the year, sales in China only declined by 8.7%. The rest of the geographies posted drops above 30%: -37.0% in Europe, 37.2% in Italy and -48.2% in Americas.

Revenue of the retail channel registered a slight improvement in the fourth quarter. The performance of the DOS network was affected by the persistent pandemic scenario; after a good performance in October, new lockdowns were imposed in November in Europe and, subsequently, also in some Asian countries. The average store opening rate fell from 98% in October to 83% in November and 87% i nDecember. Overall, however, the results of the DOS network in the fourth quarter showed a slight improvement compared to the third quarter figure. In the meantime, the e-commerce channel continued its very strong double-digit growth, with a further acceleration in the fourth quarter of the year, and generated particularly positive results. On the contrary, the result of the wholesale channel remained visibly negative (the channel is experiencing a structural downsizing, especially in Europe and the USA).

In terms of products category, the segment leather goods and accessories had the biggest decline in the year (down by 39.6%). Shoes and apparel generated revenue, which was down by, respectively, 29.0% and 29.4%.

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