Q1 FY24, Italian luxury group, Salvatore Ferragamo experienced a significant 16.6 per cent decline in revenues at constant exchange rates. The group attributed this downturn to challenges in the Chinese market, alongside a broader slowdown in sales across all regions and channels.
Highlighting the ongoing volatility in China, Marco Gobbetti, CEO, named persistent weakness in wholesale and travel retail as key factors impacting their performance. Revenues for the period declined to €227 million, falling short of analyst expectations.
Sales in the direct-to-consumer channel saw a slight negative trend in April, though Gobbetti said, these improved over the quarter, with revenues in this channel remaining stable from February to April.
Despite the tough market conditions, Gobbetti assured that the gross margin was not expected to deteriorate further. He emphasised a focus on enhancing top-line performance, pointing out a positive trend in direct-to-consumer sales in Europe.
While facing headwinds in key markets like China, Gobbetti reiterated Salvatore Ferragamo’s commitment to navigate these challenges and seek new growth opportunities for growth, particularly in their direct-to-consumer channels.
