From Home Furnishing Business
Natuzzi Q3 Loss Nearly Doubles as Sales Fall 6.1%
Leather upholstery producer Natuzzi (NYSE: NTZ) said third-quarter sales fell 6.1% and its net loss nearly doubled to 10.9 million euros, or about $13 million, due to delivery delays and weakness in its Softaly private label division.
Worldwide sales totaled 95.8 million euros, or about $114.3 million in the most recent quarter, compared with 102 million euros, or about $121.6 million in last year’s third quarter.
For the first nine months of 2017, worldwide sales slipped 0.9% to 329.5 million euros, or about $393 million. The nine-month net loss was 25.6 million euros, or about $30.5 million. That compares with a loss of 6.7 million euros, or about $8 million in the same period in 2016.
The company said sales for the Softaly division were down 8.6% worldwide in the first nine months, including a 28.2% plunge in sales in the Americas due to “difficulties experienced with large retailers in North America.”
The company said price competition was very strong on the North American market, and said it is “re-examining both the engineering and product simplification for Softaly.”
In addition, the nine-month figures included an operating loss of 9.8 million euros, or about $11.7 million, in its branded retail stores. However, the company said order flow for branded product is up, and sales at its company-owned retail stores are showing organic growth.
“Although the financial results for the quarter were disappointing, the operational results start improving and give us confidence in our future,” said Chairman Pasquale Natuzzi. “Our retail sales are growing, both through our expansion and organically in our existing stores. Our numbers were damaged by the lack of proper coordination between procurement and production, a situation which we have fixed. Had we not had this issue, our revenues would have grown. I am more convinced than ever that our strategy works and that Natuzzi will return to its place as the leading global high end branded lifestyle manufacturer in 2018.”