Nov 14, 2008
Italy's Geox 9-mth sales rise, costs hit margins
Nov 14, 2008
* Revenues 799 million euros, up 15 percent * EBITDA 212 million euros, up 1 percent
(Adds details, share price)
MILAN, Nov 14 (Reuters) - Italy's Geox, the maker of "no sweat" shoes, reported a 15 percent rise in its sales but said core earnings edged up just 1 percent in the first nine months as higher costs hurt its margins.
Geox said on Friday november 14th its core profit, or earnings before interest, depreciation and amortisation (EBITDA) were 212 million euros.
Geox, which makes shoes with breathable soles, said sales were 799 million euros, up from 694 million a year ago.
The company said its EBITDA margins fell in the period because of a marked increase in costs, partly relating to opening new shops.
Geox Chairman and founder Mario Moretti Polegato nevertheless remained upbeat.
"I am confident that our group, thanks to the strength of the Geox brand and the financial solidity of our balance sheet, will come out of this crisis stronger than before," he said in a statement.
Geox said net profit rose 3 percent to 134 million euros.
Shoe sales in the period were 725.4 million euros from 646.9 million a year ago, while clothing sales were 72.8 million euros, up from 45.1 million.
By region, sales in Italy were up 15.1 percent at 298.9 million euros, while in the rest of Europe they rose 9.3 percent to 348.9 million. In the U.S. sales totalled 22.3 million euros, up 10.7 percent.
Geox has said it is targeting 20 percent annual sales growth over the next three years as it more than doubles its store network. It is planning to expand its number of stores to more than 1,500 by 2010 from 724 at the end of last year. Geox shares were down 1.92 percent at 4.6 euros at 1205 GMT, while the Milan index of top 40 shares .SPMIB was up 2.58 percent. (Editing by Will Waterman)
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