MILAN (Reuters) – Sales at Italian fashion group Tod’s rose by 23% in the first quarter, extending a recovery that started last year and beating market expectations despite a slowdown in China from March.
Revenues totalled 219.6 million euros ($231.68 million) in the period, driven by Europe and Americas, while revenues in China were hit by a new round of COVID restrictions.
Overall quarterly sales are a touch above 2019 levels, before the pandemic hit.
Analysts had expected 212 million euros sales, according to a consensus cited by broker Equita.
“While we wait to better assess the impact of the war in Ukraine and the signals arriving from China on the COVID front, we continue to develop each brand …, making all the necessary investments,” Chief Executive Diego Della Valle, the largest shareholder, said on Wednesday in a statement.
The luxury leather goods maker said currently around 30% of its stores in China were closed due to lockdowns and restrictions in Shanghai and other cities. The curbs are set to hit the luxury industry heavily in the second quarter in a key market, with some analysts predicting a 40% decline in Chinese revenues on average.
Tod’s, famous for its Gommino loafers, launched a new strategy in late 2017 to revamp its brands and lure younger consumers, but the health crisis hampered its efforts. Group sales bounced back by almost 40% last year, marking the first increase after five years of consecutive declines.
($1 = 0.9479 euros)
(Reporting by Claudia Cristoferi, editing by Silvia Aloisi)
