“Within this challenging environment, we continue to pursue our mid-term development plan, making all the investments necessary to support a solid growth of sales and EBITDA, also thanks to a careful cost control. We continue to carefully develop our distribution network and to invest in human resources and in production capacity, in order to face the growing demand. Our attention for quality and exclusivity increases more and more the respect and the loyalty of clients; the decision to make the Fashion shows contributes to increase the attention of consumers for our brands. We think that the decision to give priority to the mid-term development of our Group is correct and will bear fruits in the nearest future. The first feedback of clients to the Fall Winter collections is very encouraging and, if this trend will continue, we can look at the yearly performance with a positive stance”, commented Diego Della Valle, Chairman and CEO of the Tod's group.

Consolidated sales stood at 477.7 million euros in the first half of 2014, down 2.7% from H1 in 2013, with performance impacted by currency fluctuations. At constant exchange rates, sales would have been 488.6 million euros, down 0.5% from H1 2013. In a press release issued by the company it can be read that: “As expected, the current semester is the last one to be impacted by the Group’s strategic decision, started in 2012, to rationalize the wholesale distribution, mainly on the domestic market, with the goal to preserve the brands’ exclusivity and positioning, but also to improve the already very good quality of the credit portfolio. The rationalization affected all the brands, but it was mainly evident in the results of Hogan and Fay, which are the brands, among the Group’s portfolio, with the higher exposure to the Italian market and to the wholesale channel.”

Tod’s, the main brand within the group’s portfolio, represented 60.7% of the sales generated during the semester, followed by Hogan with a 21.9% share. Tod’s brand totaled 290.2 million euros in sales, up 0.8% at constant exchange rates from H1 2013, and -2.0% at current exchange rates. The brand registered positive results in Europe but had negative performance in Greater China, due to the temporary weak consumer environment. Within the positive environment in the Americas the performance was affected by the temporary closing of two major boutiques, including the New York Madison Avenue flagship store. Hogan revenues were 104.5 million Euros, with a decrease of 5.8% at constant rates and 6.1% decline at current rates; solid double-digit growth on all the international markets, where the brand is currently focusing its international expansion. The Fay brand registered sales of 22.8 million euros, down by 4.9% (current rates and constant rates). The performances of both brands was impacted by the rationalization of the Italian distribution network. Roger Vivier totaled 59.8 million euros in revenues, up 5.0% at constant rates from H1 2013 (+1.4% at current rates). This brand has been visibly affected by the slowdown experienced by the luxury goods industry in the Chinese market.

The group consolidated its leadership in the core business of shoes, now representing 78.2% of total revenue and standing at 373.7 million euros in the first half of 2014. Slightly positive performance of sales from leather goods and accessories, despite the weak consumer environment in Greater China, which is one of the most important markets for this category. Revenues of this category totaled 77.1 million euros, up 0.7%, at constant rates. Finally, sales of apparel were 26.5 million euros, down by 4.9% (mainly generated by the performance of the Fay brand).


Italy is the main market of the group, with 31.1% of revenue generated in the country; Europe (excluding Italy) follows with a 22.6% share. In the first half of 2014, domestic sales stood at 148.5 million euros, down 7.8% (current and constant rates); the decrease, compared to H1 2013, is mainly due to the rationalization of the wholesale distribution. The group achieved good results in the rest of Europe with revenues in the area totaling 108 million euros, up by 6.4%, at current exchange rates. The group’s sales in the Americas totaled 42.3 million euros, down by 2.7% at constant rates (-7.2% at current rates). The performance of Greater China confirmed the weakness of the last few months, standing at 117.8 million Euros, down 7.6% at current rates (-3.6% at constant rates) from H1 2013, at constant exchange rates which according to Tod’s is due to the general and deep contraction of luxury goods consumption.

In terms of the distribution channel, Directly Operated Stores (DOS) generated 301.1 million euros in sales, 63.0% of total revenue of the group, with third party (includes franchised stores and independent retailers) being responsible for 176.6 million euros (37.0%).

The group’s net income was 56.2 million euros, down by 25.7% from the 75.7 million euros posted during the first semester in 2013.

Tod's shares were last traded at the Milan Stock Exchange at 84.40 euros on the 28th August.

For more information about Tod’s group please refer to the company’s website.