Italian fashion group Aeffe still in the red for 2013

By

Dominique Muret

Published
Mar 17, 2014

Aeffe SpA has published the results of its fiscal year 2013, with sales in line with the company’s 2012 results at 251.1 million euros (-1.2% at current exchange rates, +1.2% at constant exchange rates).

The Italian fashion group is a big player in the ready-to-wear segment and owns the brands Alberta Ferretti, Moschino and Pollini shoes. The company's net loss increased to 3.2 million euros for 2013, up from 3 million euros in 2012.

Aeffe's operating profit (EBIT) declined by 31.7% to 6 million euros, compared to 8.8 million euros a year earlier. Its gross operating income (EBITDA) also decreased by 9.6% from 22.8 million euros in 2012 to 20.6 million last year. Aeffe mainly attributes that drop to costs related to the relaunch of Philosophy, the second line of Alberta Ferretti, and the development of new licenses for Ungaro and Cédric Charlier, and assures that "these actions will produce their benefits starting from fiscal year 2014."

The group has embarked upon a number of major investments through a total make-over of its creative concept. Current initiatives include new licenses for Cédric Charlier and Emanuel Ungaro by Fausto Puglisi, the arrival of Nathalie Ratabesi at the creative helm of Philosophy and the appointment of Jeremy Scott as creative director of Moschino, whose first collection was presented February 20 in Milan.

The company says it was satisfied with 2013, "and especially thinking about the future," pointing to its creative renewal and a strong focus on online sales, retail sales and the most dynamic markets.

"We are satisfied with the results of the group, in particular with regard to the reorganization of the brand portfolio," said Massimo Ferretti, executive chairman of Aeffe. "The positive reactions to the long-awaited debut of Jeremy Scott at the helm of the Maison Moschino were beyond our expectations and so was the development of other projects, such as the upgrade of the Alberta Ferretti collections as well as those of Cédric Charlier and Emanuel Ungaro."

Looking at the company's year across geographic regions, the results were the opposite compared to last year. The big surprise came from the Italian market, accounting for 41% of Aeffe's total sales, up 5.2% to 104.5 million euros, driven by particularly good results for Moschino following the opening of its store in Rome. In 2012, sales in the company's home market dropped 3.4%.

In contrast, sales in the European market (excluding Italy and Russia), declined 7% in 2013 compared to 2012, representing 20% of the group's total sales for the most recent fiscal year.

Sales dropped 8.4% in Russia and 10.9% in the United States. On the growth side was a 9.4% increase in Japan (+12.1% at constant exchange rates), the Middle East (+7%) and Mainland China (+20%).