Tough times for Geox in 2019, not a rewarding year indeed

Non è stato un anno brillante: Geox soffre nel 2019

2019 was not a brilliant year for Geox. Yesterday, the brand, headquartered in Montebelluna, made public its financial statements, which confirmed the negative trend of the first nine months of the business year. Store retail is limping along. Conversely, online sales are running soundly.

Footwear goes down and apparel goes up

As we said, 2019 was not one of the best years for Geox. In fact, the brand’s revenues amounted to 805.9 million euros, therefore decreasing by 2.6% at current rates of exchange and dropping by 3.3% at fixed rates of exchange. Earnings coming from the footwear segment, which drives 89.4% of the consolidated turnover, reached 720.8 million euros. They dropped by 3.1% (-3.8% at fixed rates of exchange). Conversely, apparel sales have been increasing (10.6% out of overall revenues): earnings amounted to 85.1 million euros, therefore rising by +2.3% (+1.8% at fixed rates of exchange).

The comment

“Apparel sales, carried out in the stores we manage on our own, achieved a very positive performance, as revenues increased by +11%”, announced the company. Let us look at geographical business areas: in Europe, our earnings, which account for 42.7% of the group’s revenues (42.9% in 2018), reached 344.3 million euros. In 2018, they amounted to 354.7 million euros”. Therefore, they decreased by -2.9%.

Good news from online sales, fortunately

E-commerce has been growing in double figures: throughout 2019, sales went up by +29%. Considering such figures, as much as other marketing factors, the brand is going to revise, faster than expected, its direct supply and distribution network. The aim is “to ensure – pointed out Mario Moretti Polegato, Geox president and founder – a prompt enhancement of the group’s profitability”. On top of that, “we also want to focus on a few projects in order to adjust, in a timely manner, our business model and make investment assets available”.

Libralesso to take over

“Looking back at 2019, we had to deal with a rather complicated scenario – emphasized Moretti Polegato –. The whole industry is clearly up to a relevant reorganization”. Grounds for that lie “in the buyers’ shopping habits, which are considerably changing, as they turn more and more digital. Because of that, physical stores’ business is remarkably declining. The most affected shops are the ones located in minor and non-strategic positions or, as well, in countries that must face social and political tensions”. In the meantime, Geox have approved a deal over the resignation, prior to mutual consent, of chief executive officer Matteo Mascazzini. They have already chosen the person who is going to take over: Livio Libralesso.

In the picture, provided by Imagoeconomica, Mario Moretti Polegato





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