Aeffe Spa, the esteemed Italian luxury fashion firm, has reported a significant turnaround in its financial performance for the first nine months of 2024. The company achieved a net profit of approximately €35.2 million, or $38.7 million, reversing last year’s loss of €17.8 million during the same timeframe. However, the company faced a steep revenue decline, dropping 17.6 percent year-over-year to €207.8 million, equivalent to around $219.2 million.
In an impressive display of operational resilience, Aeffe’s EBITDA soared to €90.9 million, translating to about $95.9 million, which represents a robust margin of 43.8 percent. Despite this strong performance on the profit side, the company’s revenues were hampered across all regions, particularly in the wholesale sector, where sales plummeted by 20.3 percent.
Aeffe Spa’s strategic initiatives center on reorganizing its brand portfolio amid the ongoing challenges of global consumption slowdowns. Detailed financial reports indicate that revenue from the pret-a-porter division reached €139.9 million, indicating a 17.5 percent decline at current exchange rates when compared to the previous year. The footwear and leather goods division saw an even steeper drop, with revenues decreasing by 22.6 percent.
Regionally, the financial landscape reveals a decline in turnover across Italy, which fell to €89.5 million, marking a 17.1 percent drop. Additionally, the wholesale channel experienced a more severe contraction of 23 percent, while retail sales dipped by 7 percent in contrast to the first nine months of 2023. In markets outside Italy, turnover in Europe decreased by 18.3 percent, attributing these losses to specific challenges in various countries and market segments.
The Asia and Rest of the World sectors saw a turnover of €42.8 million, which signifies a 19.2 percent decline year-on-year. Meanwhile, the Americas accounted for €11.9 million in turnover, reflecting a decrease of 15.3 percent.
Examining distribution channels, wholesale sales comprised 66.2 percent of total turnover, amounting to €137.6 million, and experienced a 20.3 percent reduction. Retail sales accounted for 30.3 percent, totaling €63.0 million, with a smaller decline of 12.3 percent. Revenue from royalties also decreased slightly by 7.4 percent, contributing €7.2 million to the overall performance.
Massimo Ferretti, the executive chairman of Aeffe Spa, acknowledged the hurdles faced in the global luxury market, emphasizing the need for strategic adaptation in response to socio-political dynamics and a cautious consumer landscape. He expressed optimism regarding the ongoing reorganization efforts for the Moschino brand and the rebranding of the Alberta Ferretti label, suggesting these initiatives could unveil promising opportunities for growth.
As of September 30, 2024, Aeffe Spa’s financial position presented a net equity of €114.6 million, a substantial increase from €79.2 million at the end of 2023. Notably, the company’s financial debt has been significantly reduced to €72.3 million, net of the IFRS 16 effect, compared to €152.5 million at the close of the previous year. Net working capital stood at €93.6 million, representing 34.2 percent of annual revenues, reflecting a decrease from €113.5 million in 2023.
In terms of capital expenditures, the company invested €2.6 million primarily in enhancements to third-party assets and software acquisitions, while disinvestments during this period were chiefly related to the sale of a segment of the Moschino brand.
