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Salvatore Ferragamo Posts Decrease in 2023 Sales

MILAN — Salvatore Ferragamo reported a 7.6 percent decrease in preliminary 2023 revenues, but chief executive officer and general manager Marco Gobbetti touted “significant progress” in the transition of the company.

In the 12 months ended Dec. 31, sales amounted to 1.15 billion euros compared with 1.25 billion euros in 2022. At constant exchange rates, revenues were down 8.1 percent.

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On Thursday, in a statement issued at the end of trading in Milan where the Florence-based company is publicly listed, Gobbetti said that 2023 “has been a year of very intense work,” during which “we progressively increased the share of our new products in the stores, enhancing communication in terms of social media response and engagement, and editorials.”

“We have strengthened the platform in terms of brand identity, product and communication. We have been infusing heat into the brand and, especially at the end of the year, started to see some pleasing signals from new products.” Gobbetti tapped Maximilian Davis as the brand’s new creative director in March 2022, two months after joining Ferragamo from Burberry.

“We also worked on optimizing the network and on the new store concept,” which will be unveiled in the Via Montenapoleone women’s flagship in Milan next month in time for the brand’s fashion show, he said. “This is another fundamental step in the implementation of our strategy.”

In 2023, Ferragamo saw retail sales decrease 10.8 percent to 824.2 million euros, accounting for 71.2 percent of the total, “penalized by a general softening market in the last months of the year mainly impacting off-price sales,” the company said.

Wholesale revenues were down 12.1 percent to 295.6 million euros, due to a planned rationalization of the channel.

“We are conscious of the work ahead of us and remain confident that our strategy will unleash Ferragamo’s potential. The complex market environment with the slowdown of luxury demand may impact the timing of our initial assumptions, nevertheless the commitment to our ambition is unchanged,” Gobbetti concluded.

In May 2022, the executive laid out an ambitious plan that saw Ferragamo aiming to double revenues in four to five years and to double marketing and communication spending as a percentage of revenues beginning in 2023. This was to lead to a cumulative investment of 400 million euros in the 2023-26 period focused on store renovations, technology and supply chain.

In 2023, sales in the Asia Pacific region were down 13.1 percent to 362.9 million euros, accounting for 32.4 percent of the total, remaining the group’s main market. In the last quarter, sales at constant exchange rates in the area reported a positive trend compared with the fourth quarter of 2022, with wholesale positive and retail sales in Greater China up double-digit.

Revenues in Japan dropped 12.6 percent to 86.6 million euros, representing 7.7 percent of the total. At constant exchange, they were down 3.7 percent.

Sales in the Europe, Middle East and Africa region were up 3.3 percent to 270.5 million euros, despite a reduction in both channels. The area accounted for 24.2 percent of the total. In the fourth quarter, sales at constant exchange rates increased 4.8 percent on the same period in 2022.

Revenues in North America last year fell 19.2 percent to 316.2 million euros, accounting for 28.2 percent of the total.

Sales in Central and South America were down 7.1 percent to 83.4 million euros, partially impacted by a reduction of perimeter.

By category, footwear sales decreased 9.3 percent to 511.9 million euros, accounting for 45.7 percent of the total.

Sales of leather goods fell 14.1 percent to 451.3 million euros, representing 40.3 percent of the total.

Ready-to-wear was down 12.1 percent to 73.5 million euros. Silk and others were down 3.7 percent to 83 million euros.

As reported, Ferragamo earlier this week appointed Pierre La Tour as group chief financial officer, effective March 18.

La Tour will take on strategic responsibilities and succeeds Alessandro Corsi, who exited Ferragamo at the end of September to join Italy-based MinervaHub as CEO.

With extensive international management experience mainly in publicly listed companies, La Tour was previously group CFO and investor relator at Biesse Group. After an experience in Asia with Société Générale, he joined the Fiat Group in 1997, and was appointed CFO for Iveco Defence Vehicles in 2008. In 2014 he took on the role of CFO for the Specialty Vehicles business unit created within CNH Industrial, controlled by Exor and the Agnelli family. In 2015, he was called to serve as CFO China for Shanghai-based CNH Industrial, a role he ceased in 2019 to join Biesse.

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