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s-peek's magnifier: Salvatore Ferragamo

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In July, the sudden death of Sergio Marchionne caused a predictable fall of FCA’s stocks. It happened once again in the last few days, after it leaked out the news that Wanda Minelli, aka Mrs Ferragamo, was passed away. With a quite different outcome: Salvatore Ferragamo shares jumped 7,44 percent, recording the best result over the past two years.

The last few months have been quite turbulent for the company.
In April Ferruccio Ferragamo, chairman of the company since 2006, widely stated that the company was not for sale. Few months later, in June, the family holding Ferragamo Finanziaria, which owns 54,3 percent of the luxury group, sold 3.5 percent stake in the company through an accelerated bookbuilding operation. The same day, the company’s shares tumbled sharply on the stock market, losing around 8 percent.
Yet, despite the recent hardship, the company has never seemed so attractive to potential investors.
In face of Ferruccio Ferragamo’s declarations, rumors about a potential buyout has become more insistent, boosted also by the recent announcement of Micaela Le Divelec, who will leave from November the position as General Manager to fully focus on her role as company’s CEO.
Among the possible purchasers there is also Michael Kors, which, after the buyout of the maison Versace, could now further increase its offer on the fashion market. In fact, despite the light turndown, Salvatore Ferragamo is still a healthy and balanced company.

MORE Score

We decided to check the company’s financial situation on s-peek: thanks to its excellent Rating, A, the Salvatore Ferragamo S.p.A. is far above the sector average.
A comparison with the financial statements of previous years highlighted a fall in turnover, which in 2017 amounts to 1.40 billion euros. Anyway, no negatives are known and the credit limit amounts to 10 million euros.
Alongside a slight decrease in sales (from 1.42 billion in 2016 to 1.39 billion in 2017), the production costs increased, with a consequent drop in EBITDA (247 million) and EBIT (186 million).

Despite the simultaneous decrease in investments spending (in 2017 total assets amount to 1.18 billion, while in 2016 they amounted to 1.19 billion), the decrease in EBIT also led to a drop in ROI, with the consequent lowering of the Profitability ratio score from A to BBB. Solvency (AAA) and Liquidity (BBB) ratios remain stable.

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The MORE methodology used by modefinance for company evaluation is rigorous and accurate: https://cra.modefinance.com/en/methodologies/companies.

modefinance is a Certified European Credit Rating Agency.

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