In the first half ended June 30, Marcolin registered a decrease in net sales of 2.7 percent to €121.5 million, or 5.1 percent off at constant exchange rates from the same period last year. The slight decline was said to be heavily influenced by the weakness of the macroeconomic scenario in the European market.
By geographical area, the excellent trend for Marcolin's subsidiary in the U.S. stood out in particular, as its sales increased by 20.3 percent, helped by the positive effect of exchange rates. The increase in dollar terms was still significantly positive at 10.8 percent.
The Asian market posted a 12.1 percent increase, with the best results being registered in China, Japan, Korea and Indonesia. The Americas and the Far East are considered to be the strategic markets for the development of the group.
Net sales in Europe went down by 15 percent, representing 48.5 percent of the total turnover in the six-month period compared with 55.4 percent in the first half of 2011. They were affected by weakness in the demand from the markets of Italy, Spain and Portugal.
Sales in the rest of the world went up by 2.0 percent, with good results in Canada, the United Arab Emirates and Australia.
Part of the overall reduction in sales was also attributed to lower revenues for the Ferrari brand of eyewear, which is no longer licensed by Marcolin, and for the John Galliano brand. Instead, the new Diesel line, launched in the last quarter of 2011, registered a positive performance.
The gross profit in the first half declined to 62.9 percent of sales from 65.6 percent in the comparable 2011 period, mainly due to a different sales mix achieved by its subsidiaries and through distributors. There were in fact a higher proportion of sales made to foreign distributors, involving lower margins, and a marked sales drop in Europe, where the group operates mainly on a direct basis, generating higher margins.
The operating income before amortization (Ebitda) declined by 12.8 percent to €20.7 million and represented 17 percent of sales. Operating earnings after amortization (Ebit) amounted to €18.5 million, down from the previous €21.4 million, and represented 15.3 percent of sales. The reduction in sales relating to certain license agreements resulted in a lower absorption of the minimum quantities specified in the contracts, leading to a greater impact of the related costs on sales.
Net income fell to €12.6 million from €15.9 million in the year-ago period, representing 10.4 percent of turnover. The company pointed out that seasonal factors have affected the results, meaning that they cannot be expected to be repeated in the second half in the same proportion.
For the full year, the company expects to register a substantial consolidation of the results achieved so far. The group continues to strengthen its presence in Asia through investments in sales and marketing and the recent opening of a new showroom in Hong Kong.
Marcolin's portfolio of licensed brands includes eyewear for Balenciaga, Cover Girl, Diesel, DSquared2, Hogan, John Galliano, Just Cavalli, Kenneth Cole New York, Kenneth Cole Reaction, Miss Sixty, Montblanc, Replay, Roberto Cavalli, Swarovski, Timberland, Tod's and Tom Ford, adding to the house brands Marcolin and Web Eyewear.