Aeffe sees earnings shoot up 46% in 2018
today Mar 13, 2019
Italian fashion group Aeffe saw its results skyrocket once again in 2018. The company, which owns Alberta Ferretti, Philosophy, Moschino and Pollini, and holds licences for Jeremy Scott and Cédric Charlier, announced "a significant increase In EBITDA and in net profit," thanks to progress with all of its economic indicators last year.
According to a press release, the company saw its net profit rise 46% from 11.5 million euros in 2017 to 16.7 million in 2018. In 2015, the group's profits totalled 1.5 million euros. As previously announced in February, annual net revenues increased 10.9% (11.2% in constant currencies) to 346.6 million euros.
Aeffe also reported earnings before interest and taxes (EBIT) of 29.6 million euros, reflecting growth of 31%, while earnings before interest, tax, depreciation and amortization (EBITDA) were 43.3 million euros, up 18.5% from the previous year to account for 12.5% of revenues. This increase was linked to progress in sales and a reduction in operating costs thanks to Aeffe's new business model, which resulted in savings across the company.
The company's ready-to-wear division is still the San Giovanni in Marignano-based group's main source of revenue, accounting for 69% of total sales at 265.6 million euros in 2018 (up 11.2% in constant currencies from the previous year), while growth in the accessories division was 9.3%.
With 250.8 million euros in sales (up 13.9%), Moschino has maintained its role as the company's driving force, contributing 72% of total revenues, compared to 71% in 2017. Elsewhere, youth line Philosophy by Lorenzo Serafini saw double-digit growth, with revenues increasing 11.9%, while Alberta Ferretti and footwear brand Pollini also made progress. However, sales in the company's "others" category, which includes its licences for Cédric Charlier and Jeremy Scott, decreased 7.2% compared to the previous year.
Aeffe's sales rose across all of its geographical regions in 2018, except in America, where they slipped 4.8% (1.3% in constant currencies). In its Asia and rest of the world region, the group saw an increase of 23.6% in constant currencies, thanks to a jump in sales of more than 27.8% in Greater China, while sales rose 4.6% in Europe (Italy excluded) and 10.7% in Italy – the company's largest market, representing 48.6% of its total revenues.
The group's wholesale channel, which accounts for 71.5% of total sales, also helped drive revenues last year, increasing to 247.8 million euros, up 13.4% in constant currencies compared to 2017. Sales in Aeffe's company-owned retail network rose 4.8%. The company currently boasts 64 company-owned stores and 184 franchise locations around the world.
Executive Chairman Massimo Feretti said that he was confident about the coming year, when the company will be betting on "a path of further development for our brands, also in the accessories segment, along with the optimization of our presence in high-potential markets, especially in the Far East area."
Aeff also notably reduced its net financial debt by 38%, from 50.6 million euros on 31 December 2017 to 31.3 million euros a year later, thanks to improvements in its operating cash flow.
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