Limit your losses title EssilorLuxottica on the Stock Exchange Paris which, after a sharp start in decline (-2,5%) at mid-session reduced the decline to 0,6%. The Italian-French group announced yesterday the third quarter accounts of the year with revenues growing although slowing down and slightly below analysts' expectations because of the weak sales in China and especially in Hong Kong, where the economic situation remains uncertain.
In the July-September quarter Essilux recorded revenues consolidated revenues of 6,437 billion, with a year-on-year growth of 4% at constant exchange rates. They were slightly lower than Equita's forecasts of +4,7% and also compared to the 5,3% of the Bloomberg average. The data compares with an increase of 5,2% in the second quarter and 5,3% in the first half. In the first nine months of 2024, revenues grew by 4,9% to 19,7 billion.
Targets confirmed, acceleration expected in the fourth quarter
The company has however confirmed all growth goals and waits "for the fourth quarter aacceleration of turnover compared to the trend of the first nine months of the year" said the financial director Stefano Grassi answering analysts during the results conference call. At the same time, Grassi stressed that the group has seen a "clear slowdown" in revenues in China in the third quarter compared to the previous one and that in general the performance in Asia was penalised by the slowdown in Hong Kong, where it had to deal with a structural lack of tourist traffic and consumer spending. Overall, Equita says, “2024 confirms itself as a year of much stronger margin expansion than 2023. The message on the organic acceleration of the 4Q and the updates on the main strategic drivers (Ray-Ban Meta, Stellest, Nuance) leave us “more confident on the growth trajectory. We have made marginal changes to our estimates and believe there is room to be more generous on the valuation and we raise the target to 238 euros”.
The best sales are seen in Emea
In detail, in the third quarter Essilux's turnover in North America is growing 'low single digit', with sunglasses retail returning to positive territory, while in the area emea (Europe, Middle East and Africa) growth is 'mid-single digit'. In Asia and the Pacific revenues are at 794 million, up 5% but slowing compared to the two previous quarters "and with a challenging comparison with the same quarter of last year (+11,7%)", explains the company. "We also maintained solid growth in the third quarter, thanks to the contribution of all geographical areas and all businesses, our innovative approach and strong vocation for excellence", they comment Francesco Milleri, Chairman and CEO of Essilux, and Paul du Saillant, Deputy CEO.
Attention to the hypotheses of Meta's entry
Grassi, who these days 'celebrates' ten years in the role first in Luxottica and then in the company born from the merger with Essilor, when asked about the possible purchase of a share of EssilorLuxottica by Meta simply replied that "There are no updates", but there is anticipation among operators on the dossier after the last few months interest has emerged of the group that controls Facebook and Instagram for a share up to 5% of the Italian-French giant, probably to be purchased on the market.
As for the glasses Ray-Ban Meta The numbers are positive not only in the United States but also in the EU, where it was the best-selling product in 60% of Ray-Ban stores, while there are signs of easing restrictions on AI features in some markets (such as the United Kingdom).
