MILAN, May 25 (Reuters) - Italian luxury group Salvatore Ferragamo said on Thursday it confirmed a cautious outlook for this year while sticking to its medium-term guidance, after investor concerns about short-term performance hit the stock on Wednesday.
Shares in Ferragamo led losses among Italian blue-chips on Wednesday, falling as much as five percent, with market sources attributing the fall to a prudent tone of a business outlook provided by management at a meeting in Paris.
“Ferragamo confirms a cautious outlook for 2017 and that it will be a year of transition,” the Florence-based group said in a statement.
It added that the group would work this year to improve “product development, rationalise operations of (its) retail business and normalise inventory levels.”
New CEO Eraldo Poletto, who last year took over from longstanding Michele Norsa, said in February that revenue would increase at twice the market rate from 2017-2020 and expressed confidence that margins would rise as the group worked to improve the performance of existing stores.
In the near term, however, the destocking process is set to weigh on margins due to discounted sales of past collections’ items.
Shares extended losses after the statement and were down by 2.09 percent at 0810 GMT. (Reporting by Giulia Segreti, editing by Valentina Za)