Ferragamo rushing to Piazza Affari driven by the exploits of the European fashion sector, but also encouraging data on China.
The Florentine fashion house has released the preliminary data on sales for 2018 which show a drop in turnover of 3,4% compared to 2017 to 1,347 billion. At constant exchange rates, the 2018 value decreased by 1,7%. As regards the fourth quarter alone, turnover drops to 374,7 million (-3,6%) due to various factors, including the trend in currencies (-1,8% at constant exchange rates), the lower incidence of end-of-season sales in the primary channel, lower revenues in the secondary channel and the negative trend in the wholesale channel . The figure was, among other things, lower than analysts' expectations. The figure is below the expectations of analysts collected by Bloomberg, who estimated revenues for 395 million.
As regards the last three months of last year, retail revenues recorded a drop of 1,2% on a like-for-like basis, while the wholesale channel saw a 5,4% drop in revenues at constant exchange rates.
However, in the face of negative data, markets prefer to see the glass as half full and focus mainly on the positive news reached the Asia Pacific area. In 2018 as a whole, the decline was only 1%, while in the fourth quarter revenues grew by 1,3% to 142,3 million euros, thanks above all to China where the turnover achieved in direct stores increased by 7,6% compared to the same period of 2017 and 10,1% at constant exchange rates. In this context, it should be remembered that Asia Pacific is the main market for Ferragamo ed it accounts for 38% of total turnover.
According to analysts of Morgan Stanley, the numbers indicate that the group is still in transition and that recovery times remain uncertain. Despite this, US bank experts consider the results obtained in China to be encouraging, as they are in line with the trends of comparable groups. “The quality of retail is improving, with positive sales in the primary channel offset by the double-digit drop in outlets. We think that January showed a further improvement”, is the comment of Equita Sim who raised the recommendation on the stock to “hold”.
The positive trend recorded overseas meets the approval of investors who reward the stock with a wave of purchases. At 11.15 shares gain 2,7% at 17,82 euros after reaching an intraday high of 18,135 euros.
The performance is in line with the sector (+3,1% the sector index) which today rejoices in the stratospheric accounts (accompanied by indications on 2019) presented in France by Lvmh. The contagion effect, this time positive, is felt on almost all Italian stocks: Moncler +5,17%, Cucinelli +2,16%, Ovs +0,9%. On parity Tod's (+0,1%).
