In This Article:
Release Date: April 16, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
OVS SpA (FRA:0OV1) reported a strong year with total sales increasing by more than 6% compared to the previous year.
-
The Pyombo initiative achieved a significant turnover of approximately 120 million, growing by 34% year-over-year.
-
The B Angel initiative targeting younger generations saw a 50% growth, indicating solid performance and good cash margins.
-
International activities are expanding with new agreements in Mexico and Japan, expecting a 10-15% growth in sales and profitability.
-
The beauty department within stores is becoming a significant part of the business, growing by 20% in 2024 and expected to continue at high single-digit or low double-digit growth in 2025.
Negative Points
-
The company faced a difficult start to the year due to negative weather conditions affecting the first half.
-
SG&A expenses were impacted by a higher-than-normal increase in labor costs, affecting profitability.
-
Extraordinary items, including customer financial troubles and changes in tax law, negatively impacted the financial results by approximately 5 million.
-
CapEx was high compared to historical levels due to a three-year program of technological innovation, impacting cash flow.
-
The gross margin is expected to remain stable in 2025, with potential markdowns required if consumer spending decreases.
Q & A Highlights
Q: What is the tax rate guidance for this year, and can you provide an update on Stefanel's performance? A: The tax rate is expected to be around 26%, with potential reductions to 24% if certain Italian legislative benefits are realized. Stefanel experienced double-digit growth in the second half of the year, with a 25% increase in the second half after a negative first half. (Respondent: Unidentified_5 and Unidentified_2)
Q: What are the expectations for gross margin in 2025, considering factors like energy costs and currency fluctuations? A: The gross margin is expected to remain stable in 2025. While energy costs and a weakening US dollar could be advantageous, most sourcing for 2025 has already been hedged. The benefits of a weaker dollar will be more significant in 2026. (Respondent: Unidentified_2)
Q: Can you provide an update on Golden Point's performance and strategy? A: Golden Point's results were $34 million lower than expected, leading to renegotiated option costs. The strategy includes leveraging successful product segments like nightwear and fitness lines, which have shown strong sales growth. Store refurbishments have also led to a 15% sales increase. (Respondent: Unidentified_2)