The Italian group’s first quarter revenue decreased by 2.9% at constant exchange rates to 156.7 million euros.
Brunello Cucinelli said Thursday that it would not fully meet its annual targets due to the health crisis and would withdraw its proposal to pay a dividend on the 2019 results.
According to its managers, it will return to its normal growth rate as early as next year.
Brunello Cucinelli, known for its cashmere clothing, is one of the first Italian luxury groups to publish its first quarter results. The sector is vital for Italy’s economy, which has been hit very hard by the pandemic.
“The scale and scope of this emergency will not allow us to fully achieve the economic objectives we have set for 2020,” the brand said in a statement.
It therefore stated that it was withdrawing the proposal to pay a dividend on last year’s results.
Chairman and CEO Brunello Cucinelli said the group would reserve the right to reconsider its proposal in the last quarter of 2020 “if the global economic environment rebalances and with a positive business outlook for 2021”.
He went on to add: “It may take two or three months to get an overview of the whole year, but the group would return to good growth and … normality by 2021“.
In 2019, the group stated that it expects revenues to increase by about 8% in 2020 and earnings growth.
However, in 2020, its first quarter revenues fell by 2.9% at constant exchange rates to €156.7 million. Regarding the second quarter, Cucinelli said the impact of the coronavirus would be greater than in the first quarter.
This decrease is due to the impact of the coronavirus in Europe and Asia, continents where the company generates the majority of its sales.
Earlier this week, the Italian luxury goods company Ferragamo announced a drop of more than 30% in its sales.
Featured photo: © Brunello Cucinelli
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