Aeffe, the luxury group that controls the shoemaker Pollini, has announced plans to save €10 million in annual operating costs as of next year. The company said it is reducing the number of items in its collections and shortening its sales campaigns. It is eliminating 54 jobs at its head office, terminating the production of some its smaller lines and considering streamlining its retail channel.
The company indicated that it does not have plans to close any stores but intends to rationalize costs and could consider transferring some shops to more “appealing” locations. The group had 79 directly operated stores at the end of March, unchanged from the end of 2008, and 145 franchisees, compared with 138 at the end of last year.
Aeffe closed the first quarter with a 19.9 percent drop in sales to €72.3 million. At constant currency rates, sales fell by 20.6 percent. Revenues from ready-to-wear declined by 18 percent to €57.9 million, while sales stemming from footwear and leather goods decreased by 24 percent to €18.3 million.
By country, sales fell by 19.5 percent to €29.9 million in Italy, were down by 18.9 percent to €16.0 million in Europe (excluding Italy and Russia), slumped by 33.5 percent to €4.7 million in Russia, declined by 25.7 percent to €5.5 million in the U.S., slipped by 2.6 percent to €5.1 million and decreased by 19.0 percent to €11.1 million in the rest of the world.
To support sales, the group has reviewed its price positioning and reintroduced some vintage collections. Aeffe said that it is confident about 2010 and noted some timid signs of recovery that could strengthen when orders for the next spring/summer collections are lodged.
The company’s gross operating profit (Ebitda) collapsed to €3.9 million from €16.0 million and operating profit (Ebit) shrank to €1.3 million from €13.5 million. The bottom line showed a €0.3 million loss compared with a €6.0 million gain a year earlier.