Luxury Tod' S Performance Decline Plan Focus On Leather Products Development

Italy

Efforts have been made to invest and promote its women's clothing series, hoping to attract more potential consumers. In view of the long-term failure to meet the expected market performance, Tod's group chief financial officer, Emilio Macellari, said in a meeting on Wednesday's group earnings report that the group plans to shift its focus to basic development and luxury.

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Emilio Macellari said that the recent departure of Tod's creative director Alessandra Facchinetti led to the loss of brand loyal fans. The company's move will make Tod's a more fashionable leading brand and give consumers confidence again.

Emilio Macellari believes that the company's shift to focus is the right decision. He reveals that the clothing series needs more investment and has a significant impact on the profitability of the company because of its higher cost: the cost of the designer is expensive, the cost of design and production, and the cost of the fashion show is particularly high.

Emilio Macellari pointed out that 3 years ago, when Tod s had not yet developed the garment line, the pre tax profit of the company was generally within 24%, but after the development of the garment line, the pre tax profit had dropped to 19.5% at the end of 2015. This shows that the garment series really has a negative impact on the company's earnings.

According to the reporter's report, in May 5th, the news that Alessandra Facchinetti will leave the creative director of Tod 's women's wear will be heard again in a few days. Andrea Incontri, the creative director of Tod's Menswear, will also serve as the director.

Creative director.

Emilio Macellari did not respond to this. He pointed out that the company is selecting the right person to be responsible for the product design department, and is also choosing talents who can use internal resources to help team work.

As he mentioned earlier, the company is planning to shift its focus to leather products, but will not abandon the clothing department immediately.

Emilio Macellari stressed that the company understands that the introduction of women's clothing series will be a long-term plan, but the company will give up the plan if it explicitly indicates that it will not play a positive role in the company's earnings after the 5 to 6 quarter.

According to the Tod s group's earnings report released on Wednesday, the group's total revenue in the first quarter was 249 million euros, down 3.1% from the current exchange rate.

Sales of all product categories declined, with the largest reduction in leather products and accessories. Sales fell by 11.1% to 32 million 900 thousand euros; footwear sales fell 2% to 200 million euros; income from garments was basically stable at 16 million euros.

From a retail point of view, the group plans to open 10 to 15 stores this year, while closing some stores that are not selling well, and has opened 4 new stores in the first quarter.

In terms of wholesale business, Emilio Macellari revealed that the wholesale business was very positive and the orders were very abundant.

The weak sales in the first quarter and the first quarter of the second quarter confirm that the group's annual revenue growth is expected to grow by 4% at most. The pre tax profit will also be in the range of 25%. Emilio Macellari points out that clothing sales are facing challenges, but it is not impossible to overcome the current retail environment. Although the performance in the first half of the year is not satisfactory, the company's performance is very positive in the second half of the year.