Salvatore Ferragamo finished 2014 with a 5.9 percent increase in sales to €1,332 million, thanks to a 9.3 percent increase in the fourth quarter. At constant currency rates, the top line rose by 6.5 percent for the full year and by 7.7 percent for the quarter. The group's revenues were lifted by the European market and retail sales in China.
Sales in Asia-Pacific, excluding Japan, went up by 6.3 percent for the year to €495.99 million. In local currencies, they were up by 5.4 percent, with retail revenues surging by 18 percent in China. The total turnover in the region increased by some 7 percent in the fourth quarter.
Japanese sales dropped by 4 percent last year to €111.50 million, but this was due to a slide in the yen against the euro. In yen, sales rose by 3.8 percent in the full year and about 6 percent in the latest quarter.
European sales rose by 8.7 percent to €354.83 million for the year, growing by 8.6 percent on a currency-neutral basis. In the fourth quarter, they rose by about 14 percent at constant currency rates.
Northern American sales rose by 5.0 percent to €304.81 million in 2014, while Latin America was up by 10.1 percent to €64.67 million. Constant-currency revenues were up in North America by 5.2 percent during the year and by around 2 percent during the quarter. They jumped in Latin America by 13.5 percent in the full year and by 17 percent in the quarter.
The company's total sales of footwear rose by 4.5 percent in 2014 to €568.41 million, and they were up by 4.9 percent in local currencies. Shoes remain Ferragamo's largest product category but their share slipped to 42.7 percent of overall revenues from 43.3 percent a year earlier, as sales of leathergoods and handbags grew faster. Sales of leathergoods and handbags, the group's second largest product line, rose by 12.6 percent to €471.65 million, and grew by 13.2 percent at constant currencies.
By channel, Ferragamo's total retail sales rose by 3.8 percent to €833.01 million, with currency-neutral increases of 4.7 percent in the 12 months and about 6 percent in the fourth quarter. Same-store sales grew by some 2 percent in the full year and by 4 percent in the last three months. At the end of December, Ferragamo had 373 directly-operated stores (DOS).
Wholesale and travel retail revenues rose by 10.3 percent to €478.43 million. At constant currency rates, they rose by 10.2 percent in the full year and about 12 percent in the fourth quarter. This includes sales to the 270 mono-brand stores run by third parties by the end of the year.
Financial analysts expect Ferragamo to book full-year gross operating profits, or Ebitda, of about €280 million and an Ebit of over €150 million. If the predictions were fulfilled, Ferragamo would have met its target of an Ebitda margin of 21 percent in 2014. The company is scheduled to release a complete set of full-year results on March 12.
The group's chief executive, Michele Norsa, expressed confidence about 2015, as the group should benefit from positive trends in foreign exchange rates and commodity prices. Analysts anticipate that Ferragamo will finish 2015 with revenues of nearly €1.5 billion and Ebitda approaching €330 million.