Ferragamo swung to a net loss in 2024 after sales declined 10.5 per cent year-on-year at constant exchange rates to €1.04 billion, the brand said on Thursday.
The company made a €68 million net loss, down from a €26 million net profit the year before. EBITDA declined 14.5 per cent to €215 million in 2024.
Ferragamo’s sales have been dropping since the first quarter of 2023. “In 2024, we faced a complex market context characterised by ongoing geopolitical tensions and the macroeconomic uncertainties. The luxury sector went through a difficult phase with the material traffic low in Asia, particularly China, and the wholesale business was also quite negative. Both of these affected our full year results,” said board member Ernesto Greco during a call with investors.
The company said it remains “cautious on short-term expectations”, given the uncertainties around luxury consumer demand.
Ferragamo CEO Marco Gobbetti departed in February. Gobbetti, who was appointed in January 2022, had been tasked with steering a turnaround at the brand and was responsible for appointing Fashion East graduate Maximilian Davis as creative director.
Chairman Leonardo Ferragamo began Thursday’s call by thanking Gobbetti for his work, and confirmed that the company has started the process of selecting its next CEO. He also expressed his “full support to Maximilian Davis and his group, who will continue the activities of product creation and heritage enhancement that are so instrumental to strengthening our brand position”.
In the fourth quarter, sales grew everywhere but China, which dragged quarterly revenues down 4 per cent year-on-year to €291 million. It’s a move in the right direction, after a 9.6 per cent decrease in the third quarter.
By region, Asia-Pacific continued to see weaker demand, with sales down 18.9 per cent in the full year and 24.8 per cent in Q4. EMEA (Europe, the Middle East and Africa) declined 7.8 per cent in 2024, but showed positive signs of improvement in Q4, where sales grew 4.5 per cent year-on-year. In North America, sales declined 2.6 per cent for the year, with 6.3 per cent growth year-on-year in Q4. Central and South America grew 1 per cent in 2024 and 10.7 per cent in Q4. Japan, which is calculated as a separate market from Asia-Pacific, saw sales increase 3.2 per cent in the financial year and 1.2 per cent in Q4.
The company said it saw some positive signs in the direct-to-consumer channel in Q4 (which was roughly in line with last year, up 0.9 per cent), with handbags and shoes performing better. For the full year, DTC sales were down 3.8 per cent. Meanwhile, wholesale sales declined 19.3 per cent in Q4 due to weak demand in Asia and in the travel retail channel; wholesale sales were down 21.3 per cent for the full year.
In 2024, the rollout of Davis’s product offering was finalised, as the company worked on upgrading its stores. However, Greco admitted that while he believes the product offering is solid, there could be more done to “align our merchandising activity and communication activity in order to better target our customer and communicate with them”. While Ferragamo has “certainly refreshed its positioning” in the past three years, “these activities probably didn’t arrive totally to the final customers,” he said. “We want to capitalise on the learning curve so far. We will make adjustments and fine tunes to the strategy, and we will try to accelerate the execution of our activity.”
This article was updated with the approved final figures on 06/03/25 (an earlier version published in January 2025 covered the prelims).
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