Italian luxury shoemaker Tod’s sees analysts’ expectations for 2022 sales and profitability as achievable despite a marked slowdown in China due to widespread Covid-19 restrictions, its finance chief said.
The company said 30 per cent of its stores in China are closed and online deliveries have stopped because its distribution hub is in Shanghai, where heavy restrictions have been in place since mid-March.
Chief Financial Officer Emilio Macellari said that a 40 per cent sales decline in the second quarter in the country – a key market for luxury groups – was a possibility, but it would depend on how long the curbs last.
However, the group is confident it can meet analyst expectations for the full year. It cited actions such as limiting or cancelling advertising and marketing spending in affected areas and a strong performance in Europe and the US. The analyst consensus is for 2022 sales of around 970 million euros and a five per cent EBIT margin.
“Our expectations are in line with this consensus,” Macellari told analysts. “All in all, the slowdown in China is of course visible but will not jeopardise the performance of the company for the full year.”
