Tod's booked a 13.5 percent increase in 2011 sales to €893.7 million thanks to strong growth in North America and Asia, beating market expectations of a turnover of only €886 million. At constant currency rates, sales were up by 13.6 percent. The company expects to release “excellent” full-year earnings figures for the year on March 13.
Revenues rose in all major categories, with shoes up by 14.5 percent to €646.6 million, leathergoods and accessories by 17.6 percent to €144.9 million, and apparel sales by 2.6 percent to €101.6 million. Revenues from other products were unchanged at €0.6 million.
By brand, revenues increased by 19.8 percent to €487.6 million for Tod's, Hogan was up by 4.7 percent to €280.9 million, Fay was down by 2.0 percent to €87.8 million and Roger Vivier jumped by 67.9 percent to €36.5 million. Revenues from other brands dropped to €0.9 million from €0.8 million. Hogan's results were affected by the brand's reliance on the weak Italian market. The brand opened its first stores in China in September and is speeding up its international presence, especially in Asia where it expects to enjoy strong growth. Fay is also concentrated on the Italian market and has engaged in a more selective distribution policy.
With sales of €449.3 million, up by 5.5 percent from a year earlier, Italy represented half of the group's sales in 2011. The country entered a recession at the end of last year and the economy is expected to remain weak at least until the middle of 2012, the company said.
Citigroup believes that Italian revenues could represent less than 45 percent of the group's turnover this year, while the combined share for the U.S. and Asia could reach a third. The bank believes that the group can sustain a double-digit growth rate over the next three to five years in the U.S. and Asia by expanding its mono-brand store network, boosting its presence in department stores and increasing advertising spending.
Growth reached a double-digit pace outside Italy. Sales were up by 11.2 percent to €182.1 million in other European countries, increased by 17.0 percent to €62.4 million in North America, and surged by 38.1 percent to €199.9 million in Asia and the rest of the world, driven by China and Hong Kong. At constant currency rates, European sales, excluding Italy, were up by 10.0 percent, led by Germany, the U.K. and France. North American sales rose by 21.4 percent.
By channel, revenues generated by sales to third parties and franchisees were up by 9.5 percent to €420.2 million, while sales generated by directly operated stores (DOS) rose by 17.3 percent to €473.5 million. Same-store sales rose by 12.1 percent at DOS during the year.
At the end of 2011, the group had 176 DOS and 70 franchisees compared with 159 DOS and 71 franchisees a year earlier. Most of the store openings were in Asia, especially in China and Hong Kong, where the group has an aggregate of 41 DOS.