European market drives 2022 sales at Safilo

Image: Safilo headquarters in Padua Preliminary results for Safilo Group S.p.A., for the financial year ended December 31, 2022 showed that net sales amounted to 1076.7 million euros, up 11.1 percent at current exchange rates and 4.2 percent at constant exchange rates. In the year, the company said, organic sales grew by 7.7 percent at constant exchange rates, recording improvement after the 10.5 percent achieved in 2021 compared to 2019. Safilo closed the full year with an adjusted EBITDA of around 101 million euros and a margin on sales of approximately 9.4 percent. Slightly below management's expectations, 2022 adjusted EBITDA corresponds to an increase of around 24 percent and a margin improvement of 100 basis points compared to the 8.4 percent margin posted the year before. Safilo’s performance across core markets Own brands, the company added, represented an important driving force behind the group’s overall performance, in particular Smith, while Carrera and Polaroid also posted yet another year of double-digit growth, broad based by distribution channel and product category, with Carrera far exceeding pre-pandemic levels. Safilo’s licensed business also delivered very solid growth in the year. By geographical area, Europe, Safilo said, remained in 2022 the key growth driver, with the main markets of the area and the surging business in Turkey and Poland, contributing to the upside in revenues of 12.3 percent at current exchange rates, 12 percent at constant exchange rates and 16.1 percent at the organic sales level. During the year, the North American market benefited from the strengthening of the dollar against the euro, closing up 6.8 percent at current exchange rates. The performance at constant exchange rates, in total, fell by 4.7 percent and 0.3 percent at the organic sales level. Safilo reported very positive sales trends also in the Rest of the World, composed of the business in the IMEA and Latin American countries, as well as in Asia and Pacific, with the two areas respectively up 33.1 percent and 9.8 percent at current exchange rates, 21.1 percent and 3.4 percent at constant exchange rates, and 17 percent and 13.1 percent at the organic sales level. Safilo posts sales increase in Q4 In Q4 2022, Safilo's preliminary net sales amounted to 245.4 million euros, up 5.7 percent at current exchange rates and down 0.6 percent at constant exchange rates and up 0.7 percent at the organic sales level. The group’s business in Europe grew by 5.5 percent at current exchange rates, 5.1 percent at constant exchange rates and by 8.5 percent at the organic sales level. In North America, total sales were up 3 percent at current exchange rates and down 7.5 percent at constant exchange rates. At the organic level, the business softened by 4.7 percent mainly due to the tough comps base with the 19.7 percent recorded in Q4 2021 against 2019, and a softer US wholesale demand in the entry and mid-tier price points. On the other hand, the company further said, Smith posted a double-digit growth in the quarter, recovering the large part of the logistics delays impacting deliveries in the US sport shops channel in Q3, and also Blenders turned back to growth posting a positive quarter, with its online business back to a double-digit upside. Q4 sales trends remained then supportive in Asia and Pacific, up 6.5 percent at current exchange rates, 3.3 percent at constant exchange rates and 4.4 percent at the organic level, as well as in the Rest of the World thanks to a solid business development in IMEA, and the new brands in the portfolio well supporting growth in the key Latin American markets, up 22.1 percent at current exchange rates, 10.5 percent at constant exchange rates and 0.4 percent at the organic level.
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