Ferragamo posts net loss in H1, reports sales rise in China since July
Sep 16, 2020
Italian luxury label Salvatore Ferragamo recorded a net loss of €86 million in H1 due to the Covid-19 pandemic, but has reported that there has been a sharp rise in sales in China since July.
Ferragamo’s H1 revenue fell by 46.6%, down to €377 million, with a 60.1% shortfall in Q2, as the label stated in a press release published on Tuesday. The decline was caused by the worldwide lockdown measures introduced in response to the pandemic, which led to the closure of a number of Ferragamo stores, and to a halt in international connections and tourism.
Given the uncertainty still surrounding the pandemic's evolution, Ferragamo has not published any forecast for this year. However, it indicated that, in the months of July and August, business recovered significantly in China, South Korea and online. Asia-Pacific still remains the group's main market, accounting for 44.3% of sales, though revenue fell by 39.9% on an annual basis in the region in H1. Sales declined in the EMEA region too (which accounts for 22.8% of the total), losing 51.7%, and they fell by 54.4% in North America, by 37.4% in Japan, and by 54.6% in Central and South America.
Ferragamo has been beset by brand positioning problems, and experienced two tough years in 2017 and 2018. Last year, it began to get back on track, though the pandemic put the brakes on its recovery.
On Tuesday, the group confirmed its medium and long-term objectives, saying it intends to “continue to strengthen Salvatore Ferragamo’s position among the luxury industry’s leaders.”
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