Aeffe Spa, the distinguished Italian luxury group, has reported a solid turnaround in its financials for the first nine months of 2024, revealing a noteworthy net profit of €35.2 million, or roughly $38.72 million. This marks a dramatic recovery from a loss of €17.8 million during the same period last year. However, the company’s revenue faced a downturn, dropping by 17.6 percent year-on-year to €207.8 million.
The financial highlights are compelling, with EBITDA soaring to €90.9 million, yielding a robust margin of 43.8 percent. Nonetheless, this positive earning juxtaposes with significant declines across all regions in terms of turnover, particularly within the wholesale division, which plunged by 20.3 percent.
Aeffe Spa’s strategic focus over the past months has been on a comprehensive brand reorganization, undertaken in response to a global slowdown in consumption. The revenue breakdown reveals that the ready-to-wear segment amounted to €139.9 million, a year-on-year decrease of 17.5 percent. Meanwhile, the footwear and leather goods division reported a severe decline of 22.6 percent.
Regionally, the financial performance reflected a similar trend. In Italy, turnover reached €89.5 million, down by 17.1 percent from the prior year, highlighted by a notable 23 percent drop in wholesale channels. Europe’s turnover, excluding Italy, fell 18.3 percent to €63.6 million. Notably, the Asia and Rest of the World division also posted a decline of 19.2 percent, while sales in the Americas contracted 15.3 percent.
By distribution channels, the wholesale channel, accounting for about 66.2 percent of total revenues, experienced a downturn of 20.3 percent. Conversely, the retail channel experienced a slightly less severe drop of 12.3 percent, representing 30.3 percent of sales. Royalties, contributing 3.5 percent to total turnover, also saw a decline of 7.4 percent.
In commenting on the challenges faced, Massimo Ferretti, the executive chairman of Aeffe Spa, acknowledged the impact of the overall slowdown in the fashion and luxury market, citing ongoing political and social instability. However, he expressed optimism about the company’s strategic decisions and the potential of the rebranding initiatives, particularly for the Moschino and Alberta Ferretti brands.
As of September 30, 2024, Aeffe Spa reported a net equity of €114.6 million, an increase from €79.2 million at the end of the previous year, while net financial debt decreased to €72.3 million. The net working capital was recorded at €93.6 million, showing a uniform decline from €113.5 million in the same period a year earlier.
Capex investments in the first nine months of 2024 totaled €2.6 million, focusing on enhancements to third-party assets and software acquisitions, while disinvestments mainly involved the sale of a component of the Moschino brand.
Aeffe Spa, while navigating a challenging retail landscape, illustrates resilience and a strategic approach aimed at capitalizing on its brand strengths as it moves forward.
