(PRESS RELEASE) PADUA — The Board of Directors of Safilo Group S.p.A. has today reviewed and approved the economic and financial results of the first half of 2022.
Angelo Trocchia, Safilo’s chief executive officer, commented: “We are pleased with the development of our business in the second quarter. Our strategic objective to build a Safilo with a strong and balanced portfolio of brands, geographies, products and channels is progressing well. This year Europe, our second largest region, has bounced back strongly becoming the Group’s key revenue growth driver in the first semester.
Our organic business instead remained substantially in line with last year in North America, where, this year, the pace of consumption has been undoubtedly moderate behind a tougher economic environment in the United States, a market where our sales were faced with an even more demanding comparison with Q2 2021.
In Q2 we also benefited from the strength of our business in emerging markets, in particular in Brazil, Mexico and the Middle East, while China was impacted by the Covid-related lockdowns.
After posting a strong start to the year, positive top line momentum continued in Q2 with a total performance at constant exchange rates of 4.0% and another solid organic growth of 9.8% which allowed us to close the first half of the year with a double-digit organic growth of 12.0%. As expected, sales of sunglasses were back to growth, but we were equally delighted to see that our prescription frames business continued to rise.
Our brands were our strongest assets: from our own Carrera and Polaroid, which continued to record strong double-digit growth rates, adding to the outstanding performance of Smith’s portfolio of sport and outdoor focused products, to our licensed brands BOSS, Tommy Hilfiger, Kate Spade, David Beckham, UnderArmour and Isabel Marant. We are particularly proud of the strong demand for our new launches of Carolina Herrera, Chiara Ferragni and Dsquared2, all supporting our strategy for a more diversified and balanced license portfolio.
Also in the second quarter, our earnings growth continued to exceed sales growth. We delivered another meaningful expansion of the gross profit, up 20.0% compared to last year, while the gross margin soared to 56.5% from 52.3%, more than offsetting ongoing inflationary pressures of logistics and energy costs with a positive sales mix and price. This has been a key enabler to keep investing in marketing and advertising activities to fuel the growth of our brands. At the operating level, our adjusted2 EBITDA margin reached 10.6% in Q2, taking our H1 margin to 11.0%, 130 basis points higher than in H1 2021.
In the first half, we also returned to a more consistent net result, reaching 33.7 million euros, and an exponential increase compared to both H1 2021 and H1 2019.
At the end of June, our Group Net Debt was well under control, slightly below the position recorded at the end of March, and around 11 million euros higher than year-end last year due to our business seasonality.
Despite the numerous macro headwinds in which we operate, including the persistence of strong inflationary pressures and their related impacts on consumption, Covid-related restrictions and the conflict in Ukraine, our results and the trends recorded so far in the eyewear industry give us confidence to reach already in 2022 the economic targets set out in our 2024 business plan.”