Italian eyewear manufacturer Safilo has reported that the impact of the coronavirus outbreak on its business has been minimal thus far. While the fashion and luxury goods industry has been heavily affected by the epidemic, particularly in Italy, Safilo’s CEO Angelo Trocchia assures that the company’s supply chain has remained strong. Trocchia notes that China, which makes up only 1% of Safilo’s revenue, has already reopened its factory and is operating at 85% capacity. The impact of the epidemic has primarily been felt since the beginning of March, and the company has no plans for further job cuts at this time.

Safilo, the second largest eyewear manufacturer in the world, has faced challenges in increasing sales and profit in recent years. Major luxury groups Kering and LVMH have terminated licensing deals with Safilo for brands like Gucci and Dior, instead choosing to bring production in-house. Safilo’s license with LVMH’s Dior brand will expire at the end of 2020, while its production agreement with Kering will extend until the end of 2023. To address these challenges, Safilo implemented an industrial reorganization and restructuring plan in late 2019, resulting in the elimination of 700 jobs in Italy.

In terms of financial performance, Safilo reported a 9.5% decline in adjusted core profit to €51.8 million ($58.39 million) in 2019, aligning with the company’s latest guidance.

Overall, while Safilo acknowledges the potential impact of the coronavirus outbreak in the coming weeks, the company remains cautiously optimistic and is focused on executing its previously outlined plan.

Sources:
– Safilo’s official website: https://www.safilogroup.com/en/
– Financial Times article on Safilo: https://www.ft.com/content/78d808ae-6154-11ea-b3f3-fe4680ea68b5