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Lanvin Group<\/strong><\/b>, whose portfolio includes the global luxury fashion brands Lanvin, Wolford, Sergio Rossi, St. John and Caruso<\/strong><\/b>, did not shine in the first half of 2024<\/strong><\/b>. Sales fell by 20%<\/strong><\/b> to 171 million euros.<\/p>\n <\/p>\n Admittedly, the group points out that \u201cthanks to effective measures to improve cost efficiency across all brands, gross profit amounted to 98 million euros, maintaining a gross margin of 57.5%,<\/strong><\/b> reflecting Lanvin Group’s resilience and potential for sustainable growth in a challenging environment\u201d.<\/p>\n <\/p>\n The net loss, however, amounted to \u20ac69.38 million<\/strong><\/b>, compared with \u20ac72.23 million in the first half of 2023.<\/p>\n <\/p>\n <\/p>\n \u201cThe difficulties encountered by the wholesale channel<\/strong><\/b> compounded the problems associated with the slowdown in the global luxury goods market<\/strong><\/b> in the first half of 2024. We have devoted much of the first half to our marketing plan,<\/strong><\/b> but we have also given priority to streamlining our cost base<\/strong><\/b> to adapt it to the current market environment,\u201d commented Eric Chan, CEO of Lanvin Group<\/strong><\/b>.<\/p>\n\n <\/p>\n There are a number of cyclical explanations for the underperformance of the Group’s half-year sales, namely the weakness of the global luxury goods market and difficulties in the wholesale market.<\/strong><\/b> Sales in this channel plummeted by 30%<\/strong><\/b> (compared with a 14% fall in directly-operated stores).<\/p>\n <\/p>\n But the Group also suffered from a number of pebbles in the shoe for some of its Houses. At Wolford, an \u201cintegration problem with its new logistics supplier<\/strong><\/b>\u201d \u201cconsiderably delayed shipments\u201d. And Sergio Rossi<\/strong><\/b> had to implement \u201ca strategically planned reduction in <\/strong><\/b>third-party production <\/strong><\/b>\u201d.<\/p>\n <\/p>\n Geographically, sales were badly hit worldwide, but even more so in the EMEA region (where they collapsed by 27%)<\/strong><\/b> and in Greater China (-24%).<\/strong><\/b> In North America and Asia excluding Greater China<\/strong><\/b>, declines were more limited (-11% and -7% respectively)<\/strong><\/b>.<\/p>\n <\/p>\n <\/p>\n Looking at the individual Maisons in more detail, Lanvin, Wolford and Sergio Rossi were the hardest hit<\/strong><\/b> by the economic downturn.<\/p>\n <\/p>\n Lanvin’s sales<\/strong><\/b> fell to 48 million euros (versus 57 million euros<\/strong><\/b> in the first half of 2023). Its gross margin<\/strong><\/b> ,<\/strong><\/b> however, rose from 56% to 58%,<\/strong><\/b> \u201cdue to increased sales at full price and strategic inventory management\u201d.<\/p>\n <\/p>\n Contribution loss<\/strong><\/b> widened from \u20ac5 million to \u20ac9 million<\/strong><\/b> in the first half of 2024.<\/p>\n <\/p>\n Wolford’s sales fell by 28%<\/strong><\/b> to 43 million euros. Gross margin fell from 72% to 63%<\/strong><\/b>, and the contribution loss<\/strong><\/b> was 8 million euros.<\/strong><\/b><\/p>\n <\/p>\n Sergio Rossi<\/strong><\/b> saw an even more drastic fall in sales (-38%<\/strong><\/b> to 20 million euros) in the first half of 2024. Its wholesale business,<\/strong><\/b> which includes third-party production, plummeted by 60%<\/strong><\/b>!<\/p>\n <\/p>\n <\/p>\n By contrast, St.John Knits<\/strong><\/b>, the American womenswear brand, and above all, Italian menswear manufacturer Caruso, are faring a little better.<\/strong><\/b><\/p>\n <\/p>\n St.John Knits sales fell by 14%<\/strong><\/b> to \u20ac40 million in the first half, but its gross margin rose sharply from 62% to 69%<\/strong><\/b>, thanks to \u201can increase in full-price sales\u201d and \u201ca better distribution channel mix\u201d. The contribution margin<\/strong><\/b>, meanwhile, remained stable at 12%<\/strong><\/b>, thanks to \u201cimproved marketing efficiency, which mitigated the decline in sales\u201d.<\/p>\n <\/p>\n Finally, Caruso virtually maintained its sales (-1%)<\/strong><\/b>. While its production<\/strong><\/b> activity for third parties<\/strong><\/b>\u201cshowed some weakness<\/strong><\/b>\u201d, this was offset by that of its own brand Caruso, \u201cwhich grew by 21%<\/strong><\/b>, thanks to strong sales of its ready-to-wear and made-to-measure products\u201d.<\/p>\n <\/p>\n Caruso’s gross margin rose from 26% to 29%<\/strong><\/b>, \u201cthanks to improved internal production efficiency and reduced subcontracting\u201d. Its contribution profit<\/strong><\/b> also increased, from \u20ac4 million to \u20ac5 million.<\/strong><\/b><\/p>\n <\/p>\n <\/p>\n \u201cWe faced a tumultuous market in the first half of 2024,”<\/strong><\/b> admits Zhen Huang, President of Lanvin Group.<\/strong><\/b> While we expect this situation to persist in the short term<\/strong><\/b>, we remain committed to the long-term growth of<\/strong><\/b>our Group and to our path to profitability.\u201d<\/p>\n <\/p>\n \u201cTo ensure the long-term competitiveness of our brands worldwide\u201d, the Group is blowing a wind of change<\/strong><\/b>. Three major appointments<\/strong><\/b> have thus been announced in recent months, including those, in June 2024, of Peter Copping as Artistic Director of Lanvin<\/strong><\/b> and Regis Rimbert as CEO of Wolford<\/strong><\/b>. In July, Sergio Rossi<\/strong><\/b> announced thata new Creative Director, Paul Andrew<\/strong><\/b>, would join its ranks in the second half of the year. A project to optimize production and supply chain management is also underway at the shoemaker.<\/p>\n <\/p>\n <\/p>\n Lanvin Group has no illusions for the latter part of the year. The group \u201cexpects a difficult second half of 2024<\/strong><\/b>\u201d, but \u201cwill remain proactive in its cost reduction and operational efficiency efforts<\/strong><\/b>\u201d.<\/p>\n <\/p>\n Lanvin and Sergio Rossi<\/strong><\/b> thus plan \u201cto place greater emphasis on marketing initiatives<\/strong><\/b> to chart their creative paths for 2025 with the additions of Peter Copping and Paul Andrew, respectively\u201d.<\/p>\n <\/p>\n Overall, the group \u201cwill continue to focus on sales expansion opportunities through marketing campaigns<\/strong><\/b> to maintain the momentum of its brands\u201d and \u201ca tactical approach to expanding its store networks<\/strong><\/b>\u201d.<\/p>\n <\/p>\nA suffering wholesale channel<\/h2>\n
Lanvin, Wolford and Sergio Rossi hardest hit<\/h2>\n
St.John Knits and Caruso in better shape<\/h2>\n
Long-term growth<\/h2>\n
Outlook for 2024<\/h2>\n
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