Tod’s Group Sales Decline Amidst Pre-Delisting Phase and Sluggish Shoe Market
In the first quarter of 2024, Tod’s Group reported a 6.7% decrease in sales, with revenues dropping to €252.3 million from €270.5 million the previous year. The luxury Italian fashion company cited weaker shoe sales, reduced revenue from Greater China, and unfavorable foreign exchange rates as primary factors for the downturn.
Despite the overall decline, there were some positive developments. Sales for the Hogan and Fay brands saw increases of 8.2% and 12.7%, respectively. The company remains optimistic about its performance in the upcoming fall season, noting strong customer reception to new collections currently in stores.
This earnings report comes at a crucial time as Tod’s approaches a transition to private ownership, following a successful acquisition bid by Crown Bidco Srl, an affiliate of L Catterton. The move is expected to allow Tod’s to pursue long-term growth strategies away from the public eye, focusing on enhancing brand potential and making strategic investments without the pressures of public market expectations.
Regionally, the Americas and parts of Europe showed strength with substantial growth, buoyed by solid tourist purchases and local demand. However, Greater China experienced a significant downturn with a 24% drop, primarily due to decreased store traffic and consumer spending.
The company’s retail network also expanded, now comprising 349 directly operated stores and 104 franchised stores, up from last year.
As Tod’s prepares to go private, the luxury market watches closely to see how this storied brand will navigate its next chapter with experienced partners like L Catterton and LVMH.
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