Italy’s Tod’s 2019 core profits rise above expectations

Italian luxury group Tod’s warned on Thursday that it was difficult to forecast the impact of the spreading coronavirus after 2019 core profits beat market expectations despite ongoing investments to support sales.

The company, known for its loafer shoes, said its full-year earnings before interest, taxes, depreciation and amortization (EBITDA) rose to 255 million euros ($284.68 million) from 118 million euros a year earlier.

Revenue fell slightly in 2019, marking a fourth straight annual decline, but picked up in the last quarter of the year, in a sign that a strategy to re-launch the group’s brands was starting to show results.

The shoes and leather goods maker said it would pay a dividend of 0.6 euros per share from 1 euros per share a year ago.

The luxury industry worldwide is facing a major sales hit due to the epidemic which first emerged in China, home to more than a third of global luxury shoppers. It has now spread to multiple countries, with key manufacturing hub Italy the worst affected nation in Europe.
On an adjusted basis, the core profit totalled 150 million euros, compared with an average analyst estimate of 59 million euros, according to a Reuters poll.