MILAN (Reuters) – Salvatore Ferragamo (SFER.MI) will give attention to boosting profits this 12 months to fight lower growth within the luxurious business as a whole, its outgoing chief executive stated on Sunday.
Slower financial growth in China, plunging oil prices, volatile change rates and security threats that have curbed tourist flows have all put the brakes on spending on upmarket handbags, shoes and different equipment.
Ferragamo posted a larger-than-expected 5 % rise in first-quarter core profit in Might but revenue fell 2 percent to 321 million euros ($362 million).
Speaking earlier than the brand’s menswear show at Milan Men’s Vogue Week, Chief Govt Michele Norsa mentioned the luxurious sector would have to focus on managing dangers.
“Progress will not be as sturdy as in past years, when the Chinese economy and new markets have been opportunities for the business,” stated Norsa.
He said Florence-based mostly Ferragamo, whose founder designed ballet sneakers for Audrey Hepburn, is on observe to continue increasing profitability and that it would not be affected if Britain voted to leave the European Union.
Ferragamo will continue to concentrate on widening the profit margins on its products slightly than pushing sales, “given the growth of volumes can be onerous to forecast”, Norsa stated.
Norsa, who has been on the helm of the luxurious group for a decade and presided over its stock market debut in 2011, is due to leave by the top of the 12 months. He will likely be changed by Eraldo Poletto, former head of handbag maker Furla.