SECOND QUARTER 2024
HIGHLIGHTS
- 2Q 2024 OVERALL INVOICED SALES AMOUNTED TO €84.4 MILLION, UP
1% FROM €83.5 MILLION IN 2Q 2023.
- 2Q 2024 BRANDED SALES WERE €76.4 MILLION, UP 2.5% COMPARED
TO 2Q 2023 AND UP 7.3% COMPARED TO 2Q 2019. WE COMPLETED OUR
TRANSITION TO A BRANDED RETAIL GROUP: 2Q 2024 BRANDED SALES ARE
93.2% OF TOTAL SALES, FROM 91.9% IN 2Q 2023 AND 80.6% IN 2Q
2019.
- 2Q 2024 DOS SALES WERE €20.0 MILLION, UP 6.2% FROM 2Q 2023.
IN THE US, DOS SALES GREW 32.8% FROM 2Q 2023 AND 12.9% FROM STRONG
2Q 2022, CONFIRMING OUR COMMITMENT TO US RETAIL GROWTH, CHIEFLY FOR
NATUZZI ITALIA.
- 2Q 2024 GROSS MARGIN WAS 38.1%, COMPARED TO 36.4% IN 2Q
2023, 31.4% IN 2Q 2022, AND 27.9% IN THE PRE-COVID 2Q 2019. 2Q 2024
GROSS MARGIN IS THE HIGHEST SINCE 2010 WHEN THE COMPANY BENEFITED
FROM A HIGHER OPERATING LEVERAGE. EXCLUDING A €1.0 MILLION ACCRUAL
FOR WORKFORCE REDUCTIONS, 2Q 2024 GROSS MARGIN WOULD HAVE BEEN
39.3%.
- 2Q 2024 OPERATING LOSS OF (€0.4) MILLION, COMPARED TO
BREAK-EVEN IN 2Q 2023 AND A LOSS OF (€7.8) MILLION IN THE PRE-COVID
2Q 2019. IF WE EXCLUDE €1.2 MILLION OF SEVERANCE-RELATED COSTS, 2Q
2024 WOULD REPORT €0.8 MILLION OF OPERATING PROFIT.
- 2Q 2024 NET FINANCE COSTS OF (€2.0) MILLION, COMPARED TO NET
FINANCE COSTS OF (€0.8) MILLION IN 2Q 2023, AS A CONSEQUENCE OF
HIGH INTEREST RATES.
- DURING 2Q 2024, WE INVESTED €2.1 MILLION IN CAPEX, PRIMARILY
FOR THE DOS LOCATED IN THE US AND TO UPGRADE OUR ITALIAN
FACTORIES.
- WE CONTINUE EXECUTING OUR STAFF RESTRUCTURING PROGRAM TO
INCREASE COMPETITIVENESS. DURING 2Q 2024, 168 PERSONS EXITED OUR
GROUP. THESE EXITS ARE PARTIALLY OFFSET BY HIRES IN STRATEGIC AREAS
SUCH AS RETAIL, MARKETING AND MERCHANDISING. SINCE 2021, 860
PERSONS EXITED OUR GROUP, LEADING TO ~20% HEADCOUNT REDUCTION. AS A
RESULT, REVENUE PER EMPLOYEE INCREASED BY 30%, EVEN IN A CONTEXT OF
DECLINING REVENUES.
- AS OF JUNE 30, 2024, WE HELD €28.2 MILLION IN CASH, FROM
€33.6 MILLION AS OF DECEMBER 31, 2023.
- AS PART OF OUR STRATEGIC PROCESS TO DIVEST NON-CORE ASSETS
IN SUPPORT OF OUR LONG-TERM GOALS, NAMELY RETAIL EXPANSION AND
RESTRUCTURING, WE APPROVED THE SALE OF A BUILDING IN HIGH POINT,
NORTH CAROLINA, FOR $12.1 MILLION. TRANSACTION TERMS FURTHER
DETAILED BELOW.
Natuzzi S.p.A. (NYSE: NTZ) (“we”, “Natuzzi” or the “Company”
and, together with its subsidiaries, the “Group”), one of the most
renowned brands in the production and distribution of design and
luxury furniture, today reported its unaudited financial
information for the second quarter and first half ended June 30,
2024.
Pasquale Natuzzi, Chairman of the Group, commented: “The market
we operate in remains challenging, as confirmed by industry data on
our sector and more broadly on the consumer industry globally.
Our leadership team and the whole organization are working very
diligently to protect our marginality and reduce the impact of
these challenging market conditions on our business.
We remain focused and committed to pursuing our strategic
direction, with a strong emphasis on further strengthening our
brand, merchandising, marketing retail capabilities and
operations.
The journey from being a manufacturer to becoming a globally
recognized and respected brand, which I began around 20 years ago,
is well underway. I am proud of how far we have come and excited
about the results that lie ahead. I am confident that we will
overcome this challenging market phase and achieve the success that
our clients, partners, employees, and shareholders deserve.”
Antonio Achille, CEO of the Group, commented: “The second
quarter closed above 2023, in a context where not only our sector
but also most of the durable and consumer goods sectors are facing
prolonged and challenging market conditions. While we remain fully
convinced that our brands and retail deserve—and will
achieve—higher sales, we see these results as a testament to our
Company’s resilience and the strength of its Brand-Retail
strategy.
In my experience, during challenging market conditions, only
brands anchored in genuine values—like Natuzzi—can endure and
position themselves to fully realize their potential when more
favorable conditions return.
In line with the Company’s long-term plans, we remain focused on
the following priorities:
- Improve the quality of our distribution to accelerate our
Retail – Brand journey.
- Retail. The Group is making significant progress in its
transformation into a retail-branded company. The retail channel
(comprising both DOS and franchise stores) continues to expand. In
2024 we opened 32 new stores of which 5 Natuzzi Italia and 27
Natuzzi Editions. Today retail stores (DOS and FOS) contribute for
68% of total sales, compared to 64% a year ago, 50% in 2Q 2021 and
45% in 2Q 2019. Our DOS sales increased by +6.2% versus 2Q 2023,
with the U.S.-based DOS showing a significant growth of 32.8%. This
strong performance in the US is also supported by the DOS opened in
2023. As part of the Group’s strategy to strengthen and expand
Natuzzi Italia’s retail presence in the U.S., a new Natuzzi Italia
store opened in September 2024, in Denver—the first Natuzzi store
in Colorado. Located on 1st Avenue in downtown Denver, this store
is strategically positioned alongside other prominent furniture
retailers such as Roche Bobois, RH, Boffi&DePadova, West Elm,
Crate&Barrel, and Room & Board, and directly across from
the renowned Cherry Creek Shopping Center, home to world-class
luxury brands. With this addition, the Natuzzi Italia retail
network in North America now comprises 18 directly operated stores
(DOS) and 4 franchised stores, including one in Montreal, Canada.
We are also placing significant focus on retail development in
China. During my last visit in August, we inaugurated our Hangzhou
store, which replicates our Milan flagship and serves as the model
for future retail expansion globally. Following the presentation,
several dealers committed to opening new stores or renewing
existing ones based on this updated store concept. This new retail
format features the Design Studio, a dedicated space for architects
and interior designers, showcasing our latest innovations and
equipped with a state-of-the-art software configurator for
personalized, comprehensive living solutions. The Hangzhou store in
its 9 first weeks of operations is generating sales which are
double the average of remaining Chinese DOS. As of June 30, 2024,
Natuzzi collections are sold globally in 681 stores, of which 53
DOS managed directly by the Group, 18 DOS managed by our JV in
China, 3 DOS in partnership in the US and 607 franchised
stores.
- Re-imagined Gallery. Natuzzi has innovated its wholesale
branded shop-in-shop gallery, to align with modern retail needs.
Leveraging Natuzzi's global brand recognition, we introduced the
new 'Reimagined Gallery Concept', centered around a specific
'Consumer Engagement Plan' that uses digital and print channels to
drive awareness and sales. The new 'display system' enhances
consumer engagement through immersive room sets, while being
free-standing and installation-free to reduce setup costs. The
updated merchandising guidelines also feature 'total look' room
sets for improving commercial performance. Currently, Natuzzi
branded products are available at approximately 600 galleries
globally. Since launching the Reimagined Gallery Concept, we've
upgraded 55 Galleries, opened 43 new ones, and plan to add 25 more
by year-end, and are also supporting re-entry into key European
markets like Germany and France.
- Foster new market opportunities: Trade and Contract. We
are accelerating our efforts in the Trade & Contract business,
which offers significant growth potential by allowing us to
capitalize on opportunities with designers and real estate
developers with our strong brand and design expertise. We are
pleased to announce that we have recently secured 3 major contracts
with real estate developers—2 in the Middle East and 1 in Central
America—under confidentiality agreements. These contracts include
exterior and interior design services for luxury resorts and
residences as well as the supply of furniture. These exciting
projects are set to begin in the coming months, and we will provide
more details in due time. To accelerate the growth of our trade and
contract business, we have established a dedicated business unit.
This business unit will leverage Natuzzi’s assets and expertise
while maintaining distinct growth and profitability targets.
- Expand margins. Gross margin continued to improve also
in 2Q 2024. 2Q 2024 gross margin was 38.1%, compared to 36.4%
reported one year ago and 27.9% in the pre-pandemic 2Q 2019.
Notably, if we exclude the severance-related cost to reduce
workforce in China, Romania and Italy, 2Q 2024 gross margin would
have been equal to 39.3%. This result underscores our improving
quality of sales in terms of product, brand and channel mix as well
the efforts to enhance industrial efficiency hence, resulting in a
lower break-even point. These gross margin numbers become even more
valuable when we consider the low level of saturation in our
factories, particularly those in Italy, whose size is a legacy of
Natuzzi's previous commercial model.
- Execute our restructuring program. We remain focused on
reducing fixed costs and improving our operating model, across our
factories and offices, both in Italy and abroad. During the 2Q
2024, 168 persons exited our Group, partially offset by hires in
strategic areas such as retail, advertising and merchandising.
These reductions primarily involved factory workers in Romania,
China, and Italy, as well as employees at the Group level. Looking
at a longer timeframe, we have achieved so far a total net
reduction of 860 positions since 2021, representing a 20% decrease.
As a result, we improved the revenue per employee ratio by
approximately 30%, even in the context of lower revenue. As the
restructuring continues, we expect our operating model to enable us
to extract more value when sales return to historical levels.
- Elevate the quality of our leadership team. We are
pleased to announce that Nicola Internullo joins the Natuzzi Group
as Commercial HR Director, bringing a wealth of expertise from
leading global brands. Nicola will play a crucial role in
supporting us as we accelerate our transformation into a
brand-focused retail group. His deep knowledge of retail operations
and human resources, combined with a proven track record in
cultural transformation and customer experience, will be
instrumental in aligning our commercial and HR strategies to drive
growth. With experience at industry leaders such as L’Oréal, Prada,
LVMH (Loro Piana), and most recently as VP HR for Burberry
Americas, Nicola’s contributions will help us unlock new
opportunities as we shape the next chapter of our organization’s
journey.
- Divest non-strategic resources to accelerate our
restructuring program and retail expansion. In line with our
strategy to divest non-strategic assets, which was announced in
November 2021, the Company has approved the sale of the building
located in High Point, North Carolina, to its majority shareholder
for $12.1 million. Since announcing its decision to dispose of this
asset, the Company has been in the process of identifying potential
buyers, including by engaging leading brokers for this purpose. The
Company’s majority shareholder has expressed their interest in
acquiring the building as part of its investment strategy, also
reflecting a personal legacy associated with this iconic property.
The transaction has been reviewed by the Company’s Related Party
Transactions Committee to ensure compliance with the Company’s
related party transaction policy. The Company’s Related Party
Transactions Committee has determined that the sale price offered
by the Company’s majority shareholder represents fair value, based
on an independent valuation and prior indications of interest
received from third parties. The transaction is expected to close
by the end of 2024. The Company plans to use the net proceeds from
the sale to fund restructuring initiatives and expand its DOS
network, with a particular focus on the U.S. market.
The market remains challenging, delaying the full-scale benefits
of our retail expansion and restructuring: we remain focused on
strengthening our brand-retail value proposition while lowering the
group’s fixed cost base.”
2Q 2024 CONSOLIDATED REVENUE
2Q 2024 consolidated revenue amounted to €84.4 million, compared
to €83.5 million in 2Q 2023. Despite the slight increase, 2Q 2024
continued to be affected by the persisting macroeconomic and
industry-specific challenges, resulting in a reduced consumers’
spending capacity and postponement of durable purchases.
Excluding “other sales” of €2.4 million, 2Q 2024 invoiced sales
from upholstered and other home furnishings products amounted to
€82.0 million, compared to €81.1 million in 2Q 2023.
Revenues from upholstered and other home furnishings products
are hereafter described according to the main dimensions of the
Group’s business:
- A: Branded/Unbranded Business
- B: Key Markets
- C: Distribution
A. Branded/Unbranded business
The Group operates in the branded business (with Natuzzi Italia,
Natuzzi Editions and Divani&Divani by Natuzzi) and unbranded
business, the latter with collections dedicated to large-scale
distribution.
A1. Branded business. Within the branded business,
Natuzzi is pursuing a dual-brand strategy:
- Natuzzi Italia, our luxury furniture brand, offers
products entirely designed and manufactured in Italy and targets an
affluent and more sophisticated global consumer with a highly
inspirational collection that is largely the same across all our
global stores to best represent our Brand. Natuzzi Italia products
are almost exclusively sold in mono-brand stores (directly operated
or franchises).
- Natuzzi Editions, our contemporary collection, offers
products entirely designed in Italy and produced in different
plants strategically located to best serve individual markets
(mainly China, Romania and Brazil). Natuzzi Editions products are
distributed in Italy under the brand Divani&Divani by Natuzzi,
which is manufactured in Italy to shorten the lead time to serve
the Italian market where the brand is distributed. The store
merchandising of Natuzzi Editions, starting from a common
collection, is tailored to best fit the opportunities of each
market. The Natuzzi Editions products are sold primarily through
galleries and selected mono-brand franchise stores.
In 2Q 2024, Natuzzi’s branded invoiced sales amounted to €76.4
million, compared to €74.5 million in 2Q 2023.
The following is the contribution of each Brand to 2Q 2024
invoiced sales:
─ Natuzzi Italia invoiced sales
amounted to €32.6 million, compared to €31.0 million in 2Q
2023.
─ Natuzzi Editions invoiced sales
(including invoiced sales from Divani&Divani by Natuzzi)
amounted to €43.8 million, compared to €43.5 million in 2Q
2023.
A2. Unbranded business. Invoiced sales from our unbranded
business amounted to €5.6 million in 2Q 2024, compared to €6.6
million in 2Q 2023. The Company’s strategy is to focus on selected
large accounts and serve them with a more efficient go-to-market
model.
B. Key Markets
Below is a breakdown of 2Q 2024 upholstery and home-furnishings
invoiced sales compared to 2Q 2023, according to the following
geographic areas.
2Q 2024
2Q 2023
Delta €
Delta %
North America
28.5
24.7
3.8
15.5%
Greater China
6.4
6.6
(0.2)
(3.1%)
West & South Europe
24.6
26.7
(2.1)
(7.9%)
Emerging Markets
10.2
11.3
(1.1)
(9.9%)
Rest of the World*
12.3
11.8
0.5
4.6%
Total
82.0
81.1
0.9
1.1%
Figures in €/million, except
percentage.
*Include South and Central America, Rest
of APAC.
In North America the quarterly increase in sales is almost
entirely attributable to the retail component of the business, led
in particular by our DOS in the USA, whereas large distributors
still struggle to place new orders, as they continue to be focused
on reducing their stock.
In Greater China, the furniture industry and real estate markets
continue to encounter significant challenges. Enhanced coordination
efforts within our joint venture have been instrumental in reducing
the inventory of Natuzzi Italia products accumulated during 2022.
Concurrently, the JV is realigning the organization’s scale and
capabilities to better reflect recent business trends.
The performance in West & South Europe reflects a
generalized difficult macroeconomic condition, especially for some
European mature markets, as well as the loss of disposable income
by consumers as a result of prior different quarters of high
interest rates and inflation.
The emerging markets, and in particular East Europe and the
Middle East, are still curbed by the worsening of international
relations and the associated conflicts.
C. Distribution
During the first six months 2024, the Group distributed its
branded collections in 101 countries, according to the following
table.
Direct Retail
FOS
Total retail stores
(June 30, 2024)
North America
21(1)
9
30
West & South Europe
31
101
132
Greater China
18(2)
328
346
Emerging Markets
─
80
80
Rest of the World
4
89
93
Total
74
607
681
(1) Included 3 DOS in the U.S. managed in
joint venture with a local partner. As the Natuzzi Group does not
exert full control in each of these DOS, we consolidate only the
sell-in from such DOS.
(2) All directly operated by our joint
venture in China. As the Natuzzi Group owns a 49% stake in the
joint venture and does not control it, we consolidate only the
sell-in from such DOS.
FOS = Franchise stores managed by
independent partners.
The Group also sells its branded products by means of
approximately 600 points of sales located in five continents,
encompassing mostly shop-in-shop galleries (including 12 Natuzzi
Concessions, i.e., store-in-store points of sale directly managed
by the Mexican subsidiary of the Group).
In 2Q 2024, the Group's invoiced sales from direct
retail, including DOS and concessions operated by the Group,
reached €20.0 million, up from €18.9 million in 2Q 2023. This
growth was primarily driven by a 32.8% increase in sales from our
US-based DOS.
In 2Q 2024, invoiced sales from franchise stores (FOS)
amounted to €35.6 million, compared to €33.5 million in 2Q
2023.
We continue executing our strategy to evolve into a
Brand/Retailer and improve the quality of our distribution network.
The weight of the invoiced sales generated by the retail network
(Direct retail and Franchise Operated Stores) on total upholstered
and home furnishings business in 2Q 2024 was 67.8% compared to
64.5% in 2Q 2023 and compared to 45.2% in the pre-pandemic 2Q
2019.
The Group also sells its products through the wholesale
channel, consisting primarily of Natuzzi-branded galleries in
multi-brand stores, as well as mass distributors selling mainly
unbranded products. During 2Q 2024, invoiced sales from the
wholesale channel amounted to €26.4 million, compared to €28.8
million in 2Q 2023.
We are placing renewed emphasis on the wholesale segment of our
business, which remains a strategic channel in several geographies,
including the US and Europe. To support this, we are introducing a
re-imagined gallery concept, which provides a practical setting for
sales associates to engage with clients, narrate the captivating
Natuzzi story, showcase our collections, and support sales.
2Q 2024 GROSS MARGIN
During 2Q 2024, we had a gross margin of 38.1%, compared to
36.4% in 2Q 2023, and 27.9% in the pre-pandemic 2Q 2019. Notably
the 38.1% gross margin in 2Q 2024 has improved by more than 10 p.p.
since 2014 when it was on average equal to 27.5%.
The increase in 2Q 2024 gross margin was primarily driven by
improved branded and channel mix, disciplined cost control
measures, enhanced efficiency in material consumption during the
manufacturing process, effective renegotiation of supplier terms,
in addition to a general decline in raw material costs.
In 2Q 2024, labor costs increased by €0.7 million compared to 2Q
2023. This increase includes a €1.0 million of severance-related
costs, primarily in Romania, China and Italy, driven by our ongoing
efforts to right-size workforce at the Group’s facilities. Net of
such severance costs, adjusted gross margin would have been 39.3%
in 2Q 2024 compared to adjusted gross margin of 36.7% in 2Q
2023.
We intend to find further sources of efficiency, as the increase
in the Group’s gross margin remains among our top priorities.
2Q 2024 OPERATING EXPENSES
During 2Q 2024, operating expenses, which includes selling
expenses, administrative expenses, other operating income/expenses,
and the impairment of trade receivables, totaled (€32.6) million,
or (38.6)% of revenue, compared to (€30.4) million, or (36.4)% of
revenue, in 2Q 2023.
In particular, in 2Q 2024, selling expenses were (€23.8)
million, representing (28.2%) of revenue, compared to (€22.8)
million, or (27.3%) of revenue in 2Q 2023. They were mainly
impacted by the rollout of six new DOS opened in 2023. While the
productivity of these new DOS is still ramping up, in 2Q 2024 we
recorded €1.9 million of costs related to these new openings,
primarily due to labor, depreciation, marketing and other operating
activities. Net of the revenue and costs associated to this
rollout, in 2Q 2024 consolidated selling expenses would have been
equal to (€21.9) million, or (26.8%) of revenue.
The Company remains committed to further reducing selling and
administrative expenses for the remaining part of 2024. Strategies
include optimizing staff allocation at headquarters and retail
levels, renegotiating supplier contracts, as well as refining
overall processes and disciplined cost control measures to enhance
operating efficiency.
In addition, last year in 2Q 2023 we received €0.2 million as a
government contribution for R&D-related expenses, which was not
granted in 2Q 2024.
During 2Q 2024, we accrued €0.2 million, the same as in 2Q 2023,
to reduce the number of employees in our commercial subsidiaries
located in High Point, NC, and Spain.
In addition, within the caption “Other income”, during last year
second quarter, we benefitted from €1.2 million of extraordinary
income mainly related to refund from customers regarding
transportation expenses, due to prior deliveries made in an
inflationary environment. In 2Q 2024, the Company did not benefit
from such refunds.
2Q 2024 NET FINANCE INCOME/(COSTS)
During 2Q 2024, the Company accounted for (€2.0) million of Net
Finance costs, compared to Net Finance costs of (€0.8) million in
2Q 2023. One of the main drivers of the difference between the two
quarters relates to the net currency exchange movements, as we
reported a net exchange gain of €1.6 million in 2Q 2023, compared
to a net exchange gain of €0.2 million in 2Q 2024.
Persisting high interest rates continue to adversely impact our
results, principally in terms of high interest expenses of rental
contracts as well as third-party financing.
KEY RESULTS: FIRST HALF OF 2024
During the first half of 2024, the Company reported the
following results:
─ Total revenue of €168.9 million, a decrease
of 0.4% compared to the first half of 2023.
─ We had a gross margin of 37.5%, compared to
36.0% and 29.1% reported in 2023 and 2019 first half, respectively.
Excluding (€1.1) million of severance-related costs to reduce
workforce at our Chinese, Romanian and Italian factories, 2024
first half gross margin would have been 38.2%.
─ Depreciation and amortization for the
period, which include also the depreciation charge of right-of-use
assets related to the operating leases and accounted for in the
cost of sales, selling and administrative expenses, amounted to
€10.5 million, compared to €10.9 million and €11.5 million in the
first half of 2023 and 2019, respectively.
─ We had an operating profit of €0.2 million,
compared to an operating loss of (€0.9) million in 2023 first half
and an operating loss of (€10.8) million in 2019 first half. 2024
operating profit of €0.2 million includes (€1.4) million of
non-recurring accruals related to the headcount reduction program,
namely a (€0.3) million accounted for in the operating expenses, in
addition to the already mentioned (€1.1) million of labor-related
accrual accounted for in the cost of sales.
─ Net Finance costs were (€4.2) million,
mainly as a result of finance costs of (€5.0) million, due to
persisting high interest rates. 2024 Net Finance costs were the
same as in first half of 2023 and compare to net finance costs of
(€4.6) million in 2019 first half.
─ We had a loss after tax for the period of
(€4.1) million, which compares to a loss after tax of (€3.7)
million in 2023 first half and to a loss after tax of (€15.2)
million for the first half of 2019.
BALANCE SHEET AND CASH FLOW
During the first six months of 2024, (€0.5) million of net cash
were used by operating activities as a result of:
─ a loss after tax for the period of (€4.1)
million;
─ adjustments for non-monetary items of €13.5
million, of which depreciation and amortization of €10.5
million;
─ (€5.9) million from working capital change,
mainly as a result of (€0.4) million from increased inventory
level, (€2.4) million from increased receivables and other assets,
(€2.8) million for payments connected to the reduction in headcount
and (€1.4) million related to change in provisions, partially
offset by €1.2 million from increased payables and other
liabilities;
─ interest and taxes paid for (€4.0)
million.
During the first six months of 2024, (€3.6) million of cash was
used in net capital expenditure.
In the same period, (€4.1) million of cash were used by
financing activities, as a result of (€2.3) million for repayment
of long-term borrowings, (€4.9) million for lease-related payments
and (€0.2) million due to a lower utilization of credit facilities
under bank overdrafts and short-term borrowings, partially offset
by €3.3 million received in connection with a long-term borrowing
granted by an Italian financial institution.
As a result, as of June 30, 2024, cash and cash equivalents
decreased to €28.2 million, from €33.6 million as of December 31,
2023, representing a decrease of €5.4 million.
As of June 30, 2024, we had a net financial position before
lease liabilities (cash and cash equivalents minus long-term
borrowings minus bank overdraft and short-term borrowings minus
current portion of long-term borrowings) of (€17.8) million,
compared to (€6.6) million as of December 31, 2023, indicating a
deterioration of €11.2 million.
CONFERENCE CALL
The Company will host a conference call on Wednesday October
23, 2024, at 11:00 a.m. U.S. Eastern time (5.00 p.m. Italy
time, or 4.00 p.m. UK time) to discuss financial information.
To join live the conference call, interested persons will need
to either:
- dial-in the following number: Toll/International: +
1-412-717-9633, then passcode 39252103#, or
- click on the following link:
https://www.c-meeting.com/web3/join/3PQUFXRW48XTKQ to join via
video. Participants also have the option to listen via phone after
registering to the link.
Natuzzi S.p.A. and Subsidiaries Unaudited consolidated
statement of profit or loss for the second quarter of 2024 and 2023
on the basis of IFRS-IAS (expressed in millions Euro, except as
otherwise indicated)
Second quarter ended on
Change Percentage of revenue
30-Jun-24
30-Jun-23
%
30-Jun-24
30-Jun-23
Revenue
84.4
83.5
1.0
%
100.0
%
100.0
%
Cost of Sales
(52.2
)
(53.1
)
-1.7
%
-61.9
%
-63.6
%
Gross profit
32.1
30.4
5.7
%
38.1
%
36.4
%
Other income
1.3
2.4
1.5
%
2.8
%
Selling expenses
(23.8
)
(22.8
)
4.2
%
-28.2
%
-27.3
%
Administrative expenses
(10.0
)
(9.8
)
1.6
%
-11.8
%
-11.8
%
Impairment on trade receivables
(0.0
)
(0.0
)
0.0
%
0.0
%
Other expenses
(0.0
)
(0.1
)
0.0
%
-0.1
%
Operating profit/(loss)
(0.4
)
0.0
-0.5
%
0.0
%
Finance income
0.2
0.2
0.2
%
0.3
%
Finance costs
(2.4
)
(2.7
)
-2.8
%
-3.2
%
Net exchange rate gains/(losses)
0.2
1.6
0.2
%
2.0
%
Net finance income/(costs)
(2.0
)
(0.8
)
-2.4
%
-1.0
%
Share of profit/(loss) of equity-method investees
0.3
0.8
0.3
%
1.0
%
Profit/(Loss) before tax
(2.2
)
0.1
-2.6
%
0.1
%
Income tax expense/(benefit)
(0.1
)
(0.4
)
-0.2
%
-0.5
%
Profit/(Loss) for the period
(2.3
)
(0.4
)
-2.7
%
-0.4
%
Profit/(Loss) attributable to: Owners of the Company
(2.4
)
(0.3
)
Non-controlling interests
0.1
(0.0
)
Natuzzi S.p.A. and Subsidiaries Unaudited
consolidated statement of profit or loss for the six months of 2024
and 2023 on the basis of IFRS-IAS (expressed in millions Euro,
except as otherwise indicated)
Six months ended on
Change Percentage of revenue
30-Jun-24
30-Jun-23
%
30-Jun-24
30-Jun-23
Revenue
168.9
169.6
-0.4
%
100.0
%
100.0
%
Cost of Sales
(105.5
)
(108.6
)
-2.8
%
-62.5
%
-64.0
%
Gross profit
63.3
61.0
3.8
%
37.5
%
36.0
%
Other income
2.5
3.6
1.5
%
2.1
%
Selling expenses
(47.0
)
(46.6
)
0.8
%
-27.8
%
-27.5
%
Administrative expenses
(18.5
)
(18.7
)
-1.2
%
-10.9
%
-11.0
%
Impairment on trade receivables
(0.0
)
(0.1
)
0.0
%
0.0
%
Other expenses
(0.1
)
(0.1
)
-0.1
%
-0.1
%
Operating profit/(loss)
0.2
(0.9
)
0.1
%
-0.5
%
Finance income
0.4
0.3
0.2
%
0.2
%
Finance costs
(5.0
)
(4.8
)
-2.9
%
-2.8
%
Net exchange rate gains/(losses)
0.4
0.2
0.2
%
0.1
%
Net finance income/(costs)
(4.2
)
(4.2
)
-2.5
%
-2.5
%
Share of profit/(loss) of equity-method investees
0.1
2.0
0.1
%
1.2
%
Profit/(Loss) before tax
(3.9
)
(3.1
)
-2.3
%
-1.9
%
Income tax expense
(0.2
)
(0.5
)
-0.1
%
-0.3
%
Profit/(Loss) for the period
(4.1
)
(3.7
)
-2.4
%
-2.2
%
Profit/(Loss) attributable to: Owners of the Company
(4.1
)
(3.6
)
Non-controlling interests
0.0
(0.1
)
Natuzzi S.p.A. and Subsidiaries Unaudited
consolidated statements of financial position (condensed)on the
basis of IFRS-IAS(Expressed in millions of Euro)
30-Jun-24
31-Dec-23
ASSETS
Non-current assets
190.2
188.6
Current assets
146.6
149.7
TOTAL ASSETS
336.9
338.3
EQUITY AND LIABILITIES
Equity attributable to Owners of the Company
64.5
68.9
Non-controlling interests
4.6
4.3
Non-current liabilities
111.3
110.4
Current liabilities
156.5
154.7
TOTAL EQUITY AND LIABILITIES
336.9
338.3
Natuzzi S.p.A. and Subsidiaries Unaudited
consolidated statements of cash flows (condensed) (Expressed in
millions of Euro)
30-Jun-24
31-Dec-23
Net cash provided by (used in) operating activities
(0.5
)
3.2
Net cash provided by (used in) investing activities
(3.6
)
(7.9
)
Net cash provided by (used in) financing activities
(4.1
)
(15.7
)
Increase (decrease) in cash and cash equivalents
(8.2
)
(20.4
)
Cash and cash equivalents, beginning of the year
31.6
52.7
Effect of movements in exchange rates on cash held
0.4
(0.8
)
Cash and cash equivalents, end of the period
23.8
31.6
For the purpose of the statements of cash flow, cash and
cash equivalents comprise the following: (Expressed in millions
of Euro)
30-Jun-24
31-Dec-23
Cash and cash equivalents in the statement of financial position
28.2
33.6
Bank overdrafts repayable on demand
(4.5
)
(2.0
)
Cash and cash equivalents in the statement of cash flows
23.8
31.6
CAUTIONARY STATEMENT CONCERNING
FORWARD-LOOKING STATEMENTS
Certain statements included in this press release constitute
forward-looking statements within the meaning of the safe harbor
provisions of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934, as amended. These
statements may be expressed in a variety of ways, including the use
of future or present tense language. Words such as “estimate,”
“forecast,” “project,” “anticipate,” “likely,” “target,” “expect,”
“intend,” “continue,” “seek,” “believe,” “plan,” “goal,” “could,”
“should,” “would,” “may,” “might,” “will,” “strategy,” “synergies,”
“opportunities,” “trends,” “ambition,” “objective,” “aim,”
“future,” “potentially,” “outlook” and words of similar meaning may
signify forward-looking statements. These statements involve
inherent risks and uncertainties, as well as other factors that may
be beyond our control. The Company cautions readers that a number
of important factors could cause actual results to differ
materially from those contained in any forward-looking statement.
Such factors include, but are not limited to: effects on the Group
from competition with other furniture producers, material changes
in consumer demand or preferences, significant economic
developments in the Group’s primary markets, the Group’s execution
of its reorganization plans for its manufacturing facilities,
significant changes in labor, material and other costs affecting
the construction of new plants, significant changes in the costs of
principal raw materials and in energy costs, significant exchange
rate movements or changes in the Group’s legal and regulatory
environment, including developments related to the Italian
Government’s investment incentive or similar programs, the
duration, severity and geographic spread of any public health
outbreaks (including the spread of new variants of COVID-19),
consumer demand, our supply chain and the Company’s financial
condition, business operations and liquidity, the geopolitical
tensions and market uncertainties resulting from the ongoing armed
conflict between Russia and Ukraine and the Israel-Hamas war and
the inflationary environment and increases in interest rates. The
Company cautions readers that the foregoing list of important
factors is not exhaustive. When relying on forward-looking
statements to make decisions with respect to the Company, investors
and others should carefully consider the foregoing factors and
other uncertainties and events. Additional information about
potential factors that could affect the Company’s business and
financial results is included in the Company’s filings with the
U.S. Securities and Exchange Commission, including the Company’s
most recent Annual Report on Form 20-F. The Company undertakes no
obligation to update any of the forward-looking statements after
the date of this press release.
About Natuzzi S.p.A.
Founded in 1959 by Pasquale Natuzzi, Natuzzi S.p.A. is one of
the most renowned brands in the production and distribution of
design and luxury furniture. As of June 30, 2024, Natuzzi
distributes its collections worldwide through a global retail
network of 681 monobrand stores and approximately 600 wholesale
points of sale, including shop-in-shop galleries and various
distribution profiles. Natuzzi products embed the finest spirit of
Italian design and the unique craftmanship details of the “Made in
Italy”, where a predominant part of its production takes place.
Natuzzi has been listed on the New York Stock Exchange since May
13, 1993. Committed to social responsibility and environmental
sustainability, Natuzzi S.p.A. is ISO 9001 and 14001 certified
(Quality and Environment), ISO 45001 certified (Safety on the
Workplace) and FSC® Chain of Custody, CoC (FSC-C131540).
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241022133416/en/
For information: Natuzzi
Investor Relations Piero Direnzo | tel. +39 080-8820-812 |
pdirenzo@natuzzi.com
Natuzzi Corporate Communication Giancarlo Renna
(Communication Manager) | tel. +39. 342.3412261 |
grenna@natuzzi.com Barbara Colapinto | tel. +39 331 6654275 |
bcolapinto@natuzzi.com
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