Salvatore Ferragamo Rose In China

As of March 31st, Salvatore Ferragamo SpA has operated 375 Direct stores and 262 operated by third parties. The group opened new stores in Shanghai and New York in January and April this year. As early as last June, the new Losangeles store will be reopened after renovation, and a boutique in Paris is also planning to redecorate.

Italy luxury group Salvatore Ferragamo SpA recently released its latest report, which has benefited from the strong performance of China's market and handbag leather products in the first quarter of March 31st. Net profit rose 17% to 32 million euros (about 36 million 100 thousand U.S. dollars), including a minority of 1 million euros (about 1 million 100 thousand U.S. dollars). Total revenue rose 10% to 327 million euros (about 369 million 500 thousand U.S. dollars) from 299 million euros (about 409 million 600 thousand dollars) a year ago.

By region, the Asia Pacific region has become the largest market in the group, with total revenue rising by 11% and 36.6% of total sales, of which China's retail channel recorded a 22% increase. Japan rose 4.8%, accounting for 9.7% of total sales. European region rose 2%, accounting for 26.1% of total sales, while retail channel recorded double-digit growth. However, due to geopolitical tensions, wholesale business performance was relatively negative. Despite extreme weather, sales in North America recorded a 16.2% increase, accounting for 22.6% of total sales. Total revenue in central and South America rose 27.6%, accounting for 5% of total sales. Brazil and Argentina finally returned to positive performance after many years, and Mexico recorded double-digit growth.

By product category, Handbag and Leather accessories Up 16%, accounting for 37% of total revenue. Clothing category rose 3.4%, 7% of total sales. Perfume dropped 11%, accounting for 6% of total revenue. The company said it was mainly affected by unstable factors and different distribution time in Eastern Europe.

According to the channel, the retail channel of the group increased by 11.5%, and the wholesale channel only recorded a 6% increase, due to the geopolitical tension in Eastern Europe and Greece. Tourism retail stores recorded double-digit growth, which is still the fastest growing channel for the group.

In general, group profit and tax profit EBITDA rose 16% to 61 million euros (about 69 million US dollars), operating profit rose 12% to 47 million euros (about 53 million 100 thousand U.S. dollars); capital expenditure Compared with the same period last year, it rose by 26% to 12 million euros (about 13 million 500 thousand US dollars), which is mainly used for investment in the group retail network. As of March 31st, the group's net debt was 34 million euros (about 38 million 400 thousand US dollars), compared with 49 million euros (about US $65 million 100 thousand) as of December 2014, mainly due to significant operating cash.

During the conference call with analysts, CEO Michele Norsa said, "volatility is almost the most normal thing in the luxury industry." He believes that the decline in the Russian region, the uncertainty of the Greek debt crisis, adverse weather and political turmoil are all factors that affect performance.

On the issue of China's market, Norsa believes that "China's domestic market is still hard to understand." He stressed that the difference between China's big cities and the two or three tier cities has become increasingly important. Chinese tourists have been reduced to consumption in Macao and Hongkong, and to countries like Japan, Korea and Australia. Although the brand will open a new store in Macao in the next 10-15 days, there is still not much expectation for Macao and Hongkong. Europe has become the group with the least increase. Although the volume of passenger traffic has increased recently, tourists from Russia, Ukraine and some areas from Africa and Nigeria are still in a "disappearing" state. Chief executive Michele Norsa believes that the European economy has been "no longer brilliant".

When asked about the potential of brand price increases, the group said that the price of Brazil has started to rise, and prices in Europe will also change in the next quarter. But in any case, until the exchange rate tends to stabilize, this is a fundamental need. Brand positioning will be priced correctly after balancing the world. Ernesto Greco, chief financial officer, said the brand top product line is expected to achieve a median growth.