Aeffe Group, drop in revenues (-14.6%) and Ebitda. The bet is on Moschino

Double-digit drop in revenues and falling profitability. These are the main findings of the half-yearly report of Aeffe Spa, the fashion and luxury group that owns the Alberta Ferretti, Philosophy di Lorenzo Serafini, Moschino and Pollini brands. The Romagna-based group, listed on the Euronext STAR Milan segment, reported consolidated revenues of €138.6 million as at 30 June 2024, down 14.6% at constant exchange rates (and 14.9% at current exchange rates) compared to €162.9 million in the January-June 2023 period. Consolidated EBITDA also fell sharply, from EUR 8.5m in 2023, or 5.2% of revenue, to EUR 400m in H1 2024, or 0.3% of revenue. Net losses also increased - from €11.7m in H1 2023 to €20.4m in 2024 - while net financial debt (including the Ifrs effect), amounted to €231.1m, down from €253.5m at year-end 2023. Shareholders' equity decreased from EUR 79 million at 31 December 2023 to EUR 60 million at 30 June 2024.

"The unsatisfactory results of the first half of the year are the reflection of an extremely complex market situation," commented Massimo Ferretti, Executive Chairman of Aeffe Spa, in a note. "The slowdown in consumption in key countries for us, such as Italy and the United States, have significantly affected our group performance. Aware of the complexity of the moment we are experiencing, we are gearing up to face the complex situation and we are confident in the short term to see a recovery of consumer interest in fashion goods. We are satisfied with the new stylistic course of the Moschino brand, which will allow us to reposition the brand with a new international appeal".

Narrowing the focus on the group's divisions, apparel and footwear/leather goods, it can be seen that the drop in revenues was smaller (-12.9 at constant exchange rates, for a total of Euro 94 million in revenues in the half-year) in apparel, gross of the elisions between the two divisions. The most significant decrease (-25%) was in the footwear and leather goods division, which reached Euro 56.5 million in revenues as at 30 June, again before inter-divisional eliminations. Looking at the profitability indicators, for the ready-to-wear division, Ebitda was negative €3.2 million, compared to the positive €1 million in H1 2023; for the footwear and leather goods division, Ebitda was positive €3.6 million, but still more than halved compared to the €7.5 million in H1 2023. The decrease in turnover, overall, is spread across all three channels (wholesale, retail and royalties) with a marked slowdown (-17%) in the wholesale channel, which accounts for more than 91% of the group's revenue.

Looking at the individual markets, Italy, the main country for Aeffe's business with 41.6% of sales, recorded a decrease of 15.5% compared to 2023, to Euro 57.6 million. In the domestic market, the wholesale channel declined three times as much (-21%) as the retail channel (-7%), compared to the January-June period last year. While Europe recorded a 16.2 per cent decrease in sales and Asia 7.4 per cent, the market that fared worse was the US with -25.6 per cent in the six-month period.