Safilo Group S.p.A., the parent of the Smith eyewear brand, reported an improved loss on an adjusted basis in 2018 due to cost savings.
As anticipated according to a release issued on January 30, net sales for 2018 equaled €962.9 million, down 4.0 percent at constant exchange rates and 7.0 percent at current exchange rates compared to €1.04 b million in 2017.
In 2018, the wholesale business declined by 4.9 percent at constant exchange rates, with the key drivers being:
- The exit of the Céline license, just partially counterbalanced by the launch of the new Moschino, Love Moschino
and rag & bone licenses;
- The overall positive results of the Group’s own core brands, driven in particular by a strong season of Polaroid in
Spain and the good progress of the brand Safilo in the optical business;
- The broadly positive performance of the licensed brands in the contemporary and premium segment;
- The weak performance of sunglasses in the fashion luxury segment.
In the fourth quarter of 2018, Safilo’s net sales equaled €249.1 million, up 1.3 percent at constant exchange rates and
1.8 percent at current exchange rates compared to the same period of 2017. The performance of the wholesale business
was negative by 3.3 percent at constant exchange rates.
In 2018, Safilo’s economic results improved thanks to the Group’s progress on its cost saving initiatives. 2018 adjusted
EBITDA stood at €47.5 million, up 15.5 percent compared to €41.1 million in 2017, with the margin increasing by 90 basis points from 4.0 percent to 4.9 percent of net sales.
In the fourth quarter of 2018, the adjusted EBITDA equaled a profit of €10.3 million compared to the loss of €2.1 million recorded in the same quarter of 2017.
Safilo closed the year with an adjusted Group net loss of €26.7 million compared to an adjusted net loss of €47.1 million in 2017.
Angelo Trocchia, Safilo Group, CEO, commented: “The year closed substantially in line with our expectations, with a mid-single digit decline in net sales and first signs of improvement at the operating and net result level. The second half of 2018 was a key moment for Safilo as we started to implement the new 2020 plan and we secured our financial structure through a capital increase and a new debt financing. This was also a period in which we intently focused on shaping a new commercial organization in all our key markets, bringing back capabilities and leadership from the industry, with the aim of improving our go to market execution and putting customer service at the heart of what we do. An intense year in which we renewed our partnership with important brands like Banana Republic, Fossil, havaianas and Tommy Hilfiger, and we signed new agreements first with Missoni and with Levi’s at the very beginning of 2019. In 2019, we envisage the opportunity to recover top line growth and above all a sustainable level of profitability, reflecting the progress of our cost saving projects.”
More details are available here.
Safilo’s portfolio encompasses: own core brands Carrera, Polaroid, Smith, Safilo, Oxydo, and licensed brands: Dior, Dior Homme, Fendi, Banana Republic, BOSS, Elie Saab, Fossil, Givenchy, havaianas, HUGO, Jimmy Choo, Juicy Couture, kate spade new york, Liz Claiborne, Love Moschino, Marc Jacobs, Max Mara, Max&Co., Moschino, Pierre Cardin, rag&bone, Rebecca Minkoff, Saks Fifth Avenue, Swatch, and Tommy Hilfiger.