The Board of Directors of Safilo Group S.p.A. approves the 2015 Financial Results

14/03/2016
 THE BOARD OF DIRECTORS OF SAFILO GROUP S.P.A. APPROVES THE 2015

First year of investment and business transformation under the 2020 Strategic Plan

Europe, North America and key new markets performed well, while Asia restrained

Solid organic growth by the Group’s going forward brands portfolio

Strong Cash Flow generation and sound financial leverage

·         Group Net Sales at Euro 1,279.0 million for the full year, up +8.5%  vs 2014 (flat at constant exchange rates, and up +4.3% on the going forward brands portfolio)

·         Adjusted² EBITDA at Euro 102.4 million, down 13.5% vs 2014, at 8.0% of net sales

·         Adjusted² Group net profit at Euro 6.9 million. The Group reported a net loss of Euro 52.7 million including not-recurring items

·         Group Net Debt at Euro 89.9 million, compared to Euro 163.3 million in 2014, with the adjusted² financial leverage at 0.9x.

Padua, March 14, 2016 -The Board of Directors of Safilo Group S.p.A. has today approved the Company’s consolidated financial statements for the year ended 31 December 2015¹ and examined the separate financial statements for the year ended 31 December 2015¹, which will be submitted for approval by the shareholders at the Annual General Meeting to be held in a single call on 27 April 2016.

Safilo total net sales for the year equaled Euro 1,279.0 million, recording an increase of 8.5% thanks to foreign exchange tailwind. At constant currencies, 2015 net sales were flat compared to 2014, reflecting differing business and market dynamics. The performance of the Group’s going forward brands portfolio, i.e. excluding all brands that Safilo stopped and will stop servicing, showed growth of 13% at current exchange rates and 4.3% at constant exchange rates.

At the operating level, 2015 gross margin moved from 61.0% to 59.2% of sales while adjusted² EBITDA margin stood at 8.0% of sales vs. 10.0% in 2014.

Safilo closed 2015 with an adjusted² Group net result of Euro 6.9 million compared to the adjusted² net result of Euro 44.5 million recorded in 2014.

2015 adjusted economic results do not include non-recurring costs for a total of Euro 60.5 million, mainly related to the impairment of the goodwill allocated to the Far East business and a provision related to an investigation of the French Competition Authority (also see Note 2).

In 2015, the Group generated a Free Cash Flow of Euro 74.8 million, further reducing the Group Net Debt to Euro 89.9 million from Euro 163.3 million in 2014 and the adjusted² financial leverage to 0.9x from 1.4x.

This reflected the ongoing improvement in net working capital management, the proceeds from the sale of shares held in an associate company for Euro 8.6 million and the first of the three compensation payments of Euro 30 million from Kering received in January 2015.

The Board of Directors has decided not to propose the payment of a dividend to the next Annual General Meeting.

Luisa Delgado, Safilo CEO, commented:

“2015, the first year of the 2020 Strategic Plan laid out during our investor day in March, was a period of intense activity for Safilo.

The year saw capex investments of Euro 47.9 million and encouraging progress in the transformation of the business through the rebalancing of the Group’s brand strategy, development of its go to market strategy, supply network reinvention and IT transformation.

Europe and the North America wholesale business performed well, together with the key emerging markets of Middle East & Africa and Mexico. We made good progress in the reorganization of the Asian business, introducing new leadership, capabilities and brand plans, while market environment in Brazil remained very challenging.

Our core strategic license brand portfolio continued to deliver excellent results in terms of product and collection reception with consumers and registered double-digit net sales growth, while our Own core brands delivered mixed performance, primarily reflecting the short term impact of our business reorganization and new brand platforms.   

Safilo saw a strong cash flow performance, reflecting good working capital management, and the improving quality of sales, sustainable business practices and efficient business processes are enabling the Group to further strengthen its adjusted² financial leverage.

We are committed to our 2020 strategies and goals. 2016 will be a further important year of transition, including the final period of the Gucci license, and we anticipate continued growth of our core license brand portfolio to be complemented with an acceleration of growth on our core own brands, and an increasingly visible impact of our cost savings and business transformation initiatives.”
Last update: 14/03/2016, 18:03