Ferragamo sales beat forecasts in H1 despite slowdown in China

MILAN (Reuters) -Revenues at Italian luxury group Salvatore Ferragamo topped market forecasts in the first half of the year despite a slight slowdown in the second quarter due to COVID-19 restrictions in China.

Underpinned by sound growth in Europe and United States, sales rose by 17% at constant exchange rates to 630 million euros ($624 million) in the six months to the end of June, versus an analyst average estimate of 621 million euros, according to a Reuters poll.

Group operating profit totalled 95 million euros in the first six months of 2022 from 66 million euros a year earlier, the company said on Tuesday. Analysts had expected 83 million euros of EBIT.

Chief Executive Marco Gobbetti, who joined the family-owned group in January after having run Britain’s Burberry, said Ferragamo would accelerate investment in the second half of the year “to build strength in platforms and regions…whilst remaining mindful of the more volatile and challenging macroeconomic backdrop”.

Ferragamo, whose shoes have been worn by Hollywood legends such as Audrey Hepburn, has struggled in recent years to revamp its brand and appeal to younger luxury shoppers.

In May, Gobbetti promised quick progress, vowing to increase investments, revamp stores and attract younger customers to double 2021 revenues to almost 2.3 billion euros by 2026.

Last month Ferragamo struck a partnership with online luxury shopping retailer Farfetch to expand its digital presence, targeting younger shoppers.

($1 = 1.0094 euros)

(Reporting by Claudia Cristoferi, editing by Cristina Carlevaro)