Sales of Lotto brand products around the world ended 2004 at 256 million ($318.4 mm), up slightly from the sales figures posted in 2003 of 255 million ($336.8 mm).
Outstanding performances were reported by Germany (from 6.7 million to 8.2 million, up 21%), Greece (from 1.3 million to 3 million, + 133%), Turkey (from 6 million to 7.4 million, up 23%), and Benelux (from 2.3 million to 3.1 million, up 35%). Exceptional increases were also posted in many of the Eastern European countries, an area where Lotto has always had loyal customers. Sales improved in Romania (+71%), Poland (+48%), Russia (+9%) and Ukraine (+22%), partly due to the sponsorship of the National Football Federation and its striker, Shevchenko.
“We are very satisfied with the results achieved,” declared Andrea Tomat, “mainly because they were attained in a particular period of the company business. In addition to the global market situation, two other important factors influenced 2004 figures: closure of the warehouse in December, pursuant to relocation of the company offices (with the concurrent freeze in the billing in an important sales month, altering sales by 3 million) as well as the Euro and dollar exchange rate which negatively influenced the value of non-European exports by another 3 million. ”
Year on year, the Italian market accounted for fewer sales in 2004 (down from 30% to 28% of total sales), caused by the continuing crisis in the sector, in particular in terms of distribution where losses were reported in the retail channel and specialized distribution industry.
Lottos successful efforts in regional expansion and deeper commercial penetration are exemplified by sales in the Americas (accounting for 14% of overall sales, up from 12%) marking an increase of 15%, due largely to the contribution of Central and South America (in particular Chile +89%, Panama +43% and 3.4 million sales in Argentina after a year of stagnation).
A significant boost came from the Far East (which accounted for 18% of sales in 2004, posting growth of 19%) with particularly good performance reported in South Korea and Taiwan (respectively up 37% and 105%).
“We feel that the best growth will be in the East,” noted Andrea Tomat, “attention is centred on two emerging markets at the moment: China and India. Lotto will initiate two important distribution projects in both countries in 2005 and expects spectacular business development. Sales in the area as a proportion of total sales should increase substantially and we are working hard to seize all the opportunities.”
“In September, year-end figures for 2004 were estimated at Euro 260 million,” continued Andrea Tomat, “as I was counting on an upswing in sales in Italy that never materialized. I expect 2005 to be another year of transition. Still, Lotto has set growth objectives. We are working to improve on the threshold of 260 million this year.”
“To achieve its goal, Lotto is taking a three-pronged approach: product, distribution and communication. The collections are marked by advanced technology and design for improved performance and clothing styles in line with todays trends in the sportswear market. We are working to increase distribution of the brand in Italy and abroad by making the product easy to find while respecting the quality of the channel.
Sales in 2005 should benefit from a print advertising campaign that began in March and is being published in many European countries. It emphasizes the concept of superior Italian design, starring the “Ballon dOr” winner, Andriy Shevchenko, Lottos exceptional brand testimonial.”
