Ferragamo sees currencies, channel mix denting 2018 results

Italian luxury group Salvatore Ferragamo said on Monday it expected 2018 results to be undermined by currency swings and an unfavourable mix of its sales channels, after posting first quarter results in line with expectations.

The Florence-based company, which is battling against falling sales and profitability, partly due to a clean-up of inventories, issued a profit warning in December.

In a statement it said current currency trends and ongoing unfavourable channel mix would have a negative impact on sales, margins and results this year.

Although like-for-like sales in the first three months of the year were up 0.3 percent, sales in its retail channel were down 3.6 percent at current exchange rates in the same period.

Wholesale rose 2.6 percent.

The group said it would "continue to invest in a focused programme aimed at relaunching the Brand and optimising the processes," and still has work to do to turn itself around, its chairman said.

“We have to work, we still have a lot to do,” executive chairman Ferruccio Ferragamo said on Monday.

The shoemaker parted ways with Chief Executive Eraldo Poletto in March a year after he unveiled an ambitious plan aimed at refreshing the style of its products and increasing its appeal to a younger clientele.

Ferragamo said the group would press on with the strategy started under Poletto but would put on hold “everything that is very costly”.

Last month, the family-controlled company appointed a Gucci executive - Micaela Le Divelec - as general manager of the group, postponing the choice of a new CEO.

Ferragamo reiterated he hoped the new CEO would come from within the company.