Italy’s Aeffe Spa has announced a net profit of €35.2 million, approximately $38.7 million, for the first nine months of 2024, marking a significant turnaround from a loss of €17.8 million the previous year. Despite this positive news, the company experienced a substantial decline in revenue, which fell by 17.6 percent year-over-year to reach €207.8 million.
The luxury fashion group’s EBITDA climbed impressively to €90.9 million, translating to a robust 43.8 percent margin. However, all regions reported downturns in sales, with wholesale suffering the most, down by 20.3 percent. Aeffe, which is renowned for its luxury offerings, is navigating through a challenging global consumption landscape, prompting strategic initiatives aimed at reorganizing its brand portfolio.
In Italy alone, turnover dropped to €89.5 million, a 17.1 percent contraction compared to the same period last year. The wholesale segment faced a dramatic 23 percent decline, while retail sales were down by 7 percent. Across Europe, excluding Italy, revenues fell by 18.3 percent to €63.6 million, reflecting setbacks in specific markets for both wholesale and retail distribution.
In the Asia and Rest of the World segment, sales also dipped, totaling €42.8 million, down by 19.2 percent year-over-year. In comparison, the company’s presence in the Americas proved less affected, experiencing a decrease of 15.3 percent with revenues of €11.9 million during the nine-month period.
Aeffe’s wholesale channel, constituting 66.2 percent of its revenue, noted a substantial 20.3 percent drop, while retail, making up 30.3 percent, saw a milder decrease of 12.3 percent. Royalties, a smaller segment at 3.5 percent of total income, fell by 7.4 percent.
Massimo Ferretti, the executive chairman of Aeffe, acknowledged the impact of the global economic slowdown on the fashion and luxury markets. He emphasized the company’s proactive measures and reorganization strategies focusing on brands like Moschino and Alberta Ferretti, which he believes will unlock new opportunities in a challenging environment.
Financially, Aeffe’s balance sheet reflects a solid position as of September 30, 2024, with net equity rising to €114.6 million compared to €79.2 million at the end of the previous year. Financial debt has also seen a reduction, totaling €72.3 million net of IFRS 16 adjustments. The company reported net working capital at €93.6 million, declining from €113.5 million year-over-year, while capital expenditures for the first nine months of 2024 reached €2.6 million, primarily directed towards improvements and software purchases.
As Aeffe navigates this complex landscape, the focus remains on strategic innovation and brand repositioning to harness growth potential moving forward.
