Moncler SpA reported a net loss of €31.6 million in the first six months of the year as sales declined 29 percent to €403.3 million.
In the year-ago period, the outerwear company netted a profit of €70 million.
Earnings before interest and taxes fell to a loss of €35.5 million compared to an operating profit of €102.6 million in the same period last year. This includes costs related to COVID-19 of about €40 million due to inventory write-downs of about €30 million and donations to the city of Milan, Italy of about €10 million.
Moncler said results have been severely impacted by stringent measures adopted by governments worldwide in order to reduce the spread of COVID-19. In particular, the second quarter suffered the temporary closure of more than 50 percent of its store network for about two months, along with a significant reduction in traffic in the opened stores, with a revenue decrease equal to 52 percent at constant exchange rates (51 percent at current exchange rates.)
By region, sales were down 39 percent in Italy to €41.9 million. EMEA (excluding Italy) sales were down 23 percent to €181.7 million. Sales in Asia and the rest of the world were down 27 percent to €181.7 million. Sales in the Americas fell 40 percent to €49.8 million.
By distribution channel, retail sales were down 31 percent to 300.5 million. Wholesale revenues were down 23 percent to 102.8 million.
On the positive side, Moncler noted double-digit growth in Mainland China and in its online business in the second quarter.
Remo Ruffini, chairman and chief executive officer, said, “2020 will remain deeply impressed on our collective memories. We have lived through difficult months which have led us to reconsider our priorities, projects and expectations. We had to define what was essential and what could have been left for tomorrow. We learned to deal with uncertainty and the inability to predict the future. Bu,t we have also reflected and worked together to redefine and even add further brightness to our long-term vision. Moncler has always been a brand in constant evolution, this is our nature. Now, however, I believe that the changes required by the current situation should be radical and swift. Therefore, I feel that the internalization of our online business as well as the creation of a new structure to support an increasingly growing digital culture is a strategic and necessary decision.
“Today, for the first time since the beginning of the beautiful adventure with Moncler, we are announcing a negative result in the first half,” continued Ruffini. “This is a direct consequence of the health emergency that we have been experiencing and that, unfortunately, persists in many other countries. It is difficult to know how the second half of the year will evolve. I believe, however, that what we are facing will continue to have a significant impact for several months on, at least in some parts of the world. But this does not change my vision. As I have said several times before, we should never make compromises. I asked my people to make decisions with rigor; and now, more than ever is the time to do so. And, I know that Moncler will be even stronger.”
Photo courtesy Moncler
