Natuzzi S.p.A Reports Fourth Quarter Results Amid Restructuring

May 18, 2026  by Karen Parrish in Business Strategy, Industry   

Pasquale Natuzzi, Chairman and Chief Executive Officer ad interim of the Group, commented, "The global furniture market is navigating through one of its most challenging periods in the last twenty years. Trade tariffs, geopolitical instability, and softening consumer demand in key markets have placed the furniture sector under significant pressure. Furthermore, the escalation of the conflict involving the US, Iran and Israel this past March has introduced new uncertainties, which may likely lead to further discouraging consumers’ demand for semi-durable goods.”

“Full-year results, which include asset impairments, reflect both the uncertainty surrounding the current business environment, and Company specific challenges. Notably, unexpected U.S. trade tariffs imposed on EU following the production shift of Natuzzi Editions from China to Italy offset the anticipated benefits of this relocation”

“To navigate these challenges, the Company has prepared a strategic plan aimed at streamlining our cost base and pursuing long-term sustainability. This plan reflects a necessary evolution of our organizational model as it includes the optimization of our manufacturing footprint in Italy to realign production capacity with current market demand and drive structural operational efficiency. This process will be further supported by overhead restructuring actions at HQ and certain commercial subsidiaries, the review of our direct retail network, the strategic outsourcing of selected non-core activities, tight control and revision of discretionary spending.”

“In line with our strategy to enhance operational flexibility and focus on core business, we completed the sale of an asset earlier this year. The financial impact of this transaction will be reflected in our first quarter results for 2026. We remain committed to further optimizing our portfolio and are evaluating the potential divestiture of additional non-core assets in Italy that no longer align with our long-term strategic objectives.”

“While our dialogue with labor unions has proven complex, it remains constructive and open. We appreciate the positive collaboration with government institutions as we work together to identify mutually agreed solutions. Over the past few weeks, I have personally led intensive discussions with both union and government representatives to address our immediate challenges, with a strict focus on workforce reorganization and cost-optimization initiatives. Securing this agreement with the trade unions is a critical milestone in driving our comprehensive turnaround. The Company’s primary objective is to facilitate an orderly workforce restructuring and form the basis for strengthening the Company’s capital structure—an essential step in advancing the Group’s broader and structural restructuring, subject to the successful completion of ongoing negotiations. In this regard, the Company’s management and directors are progressing in evaluating capital-raising alternatives, including a potential capital increase involving also an Italian institutional investor, with which due-diligence procedures have already started.”

“At the same time, the Group has continued to invest in product development and innovation. In 2025, we introduced 50 new projects, with additional developments underway this year. We have won prestigious design awards around the world. Since 2018, the Group has expanded its retail footprint by nearly 90 stores while prioritizing network quality. This transformation included opening new Natuzzi locations alongside strategic relocations and closures, the introduction of updated retail concepts, as well as renovating Natuzzi galleries—all aimed at improving the customer experience.”

“The ‘Salone del Mobile 2026’, held in Milan in April, marked the return of the Natuzzi Italia brand, the first time since 2020. On that occasion, we presented our most innovative collections alongside a new retail concept—Natuzzi Studio—which introduces an efficient, exclusive, and experiential concept specifically engineered to facilitate collaboration with architects, designers, and clients. This new retail concept is strategically designed to support sales performance across our retail network. These initiatives are intended to strengthen Natuzzi's position in international design.”

“We have set an intense agenda of commercial, marketing and customer engagement activities for the rest of the year, including our participation at the most prestigious international design events and the upcoming sales congress to be held at our headquarters in Italy where, from May 18th onwards, we aim to welcome a majority of our retail partners and new prospects to engage in discussions and plans to promote business and sales development. While recent performance has been below expectations, we are actively rebalancing our business towards a more scalable B2B and contract-driven model. This transition is already reflected in an encouraging growing contribution from trade sales, alongside the rollout of new, design-oriented store layout.”

“The transformation we are undertaking is a necessary step to address current challenges and position the organization for long-term sustainability. The measures set out in our plan are designed to strengthen our market presence and lay the foundations for a solid and sustainable relaunch of the Company, should market conditions improve."

QUARTER FOUR HIGHLIGHTS

— Total net sales amounted to €77.5 million, up 3.4% from €74.9 million in 4Q 2024.

— Gross margin at 30.2% of revenue, compared to 38.1% in 4Q 2024, primarily impacted by the planned production shift of Natuzzi Editions from China to Italy—which saw Italian volumes increased four times year-over-year—alongside lower sales for Natuzzi Italia and the direct retail network, and a €2.3 million impairment of machinery and equipment at selected Italian factories and included in the cost of sales.

— Operating loss of (€13.6) million, compared to an operating loss of (€2.7) million in 4Q 2024. Excluding €7.6 million of total impairment—of which €3.4 million in the selling expenses, €1.9 million in the administrative expenses, and the above mentioned €2.3 million in the cost of sales—the operating loss would have been (€6.0) million mainly due to the production allocation and sales mix.

— Net finance costs were (€1.8) million, compared to net finance costs of (€1.4) million in 4Q 2024 as a result of Euro strengthening.

— Loss for the period of (€15.5) million, compared to a loss of (€3.9) million in 4Q 2024.

— As of December 31, 2025, we held €20.3 million in cash, the same as at December 31, 2024.

— Disposal of a Company’s asset completed in January 2026 for total cash consideration of €7.1 million. This transaction will be reflected in 1Q 2026 financial statements.

— Notwithstanding the positive collaboration with government institutions, negotiations with trade unions to address labor-related actions are progressing but still complex.

— In December 2025, the Company has initiated a due diligence process with a potential Italian institutional investor as part of its capital strengthening strategy.

— The Board of Directors has authorized the CEO to initiate an out-of-court negotiated composition proceeding ("Composizione Negoziata della Crisi") under protective measures from applicable Italian statutory frameworks. This voluntary restructuring framework, specific only for Italian companies, is designed to support constructive discussions with stakeholders and to facilitate an early and orderly management of the Group’s financial position, with limited court involvement. Under this procedure, the Company’s management retains both ordinary and extraordinary powers of administration and the Company's shareholders continue to exercise their ordinary rights as equity holders of the Company. The formal filing is expected to take place in the coming weeks.

— Store traffic and written orders continue to remain below our expectations, due to persistent geopolitical uncertainty and macroeconomic headwinds that continue to discourage consumer demand and, consequently, sales. This may adversely affect our results of operations.

COMPANY SEEKS TO RESTRUCTURE ASSISTANCE TO MAINTAIN OPERATIONS

Pursuant to the protective measures provided under applicable Italian statutory frameworks, on May 14, 2026, the Board of Directors of Natuzzi S.p.A. granted a mandate to the Chief Executive Officer ad interim, to initiate a negotiated crisis settlement procedure (Composizione Negoziata della Crisi – "CNC"), aimed at enabling the Company to accelerate financial and operational rebalancing while preserving business continuity, industrial value, and the interests of all stakeholders. The formal application to initiate the CNC process will be submitted in the coming weeks.

The CNC is an out-of-court restructuring framework designed to facilitate consensual negotiations, where the Company’s management retains both ordinary and extraordinary powers of administration. Under this procedure, the Company's shareholders continue to exercise their ordinary rights as equity holders of the Company.

Under the guidance of an independent expert appointed by the competent Chamber of Commerce, the procedure aims to reach mutually agreed solutions with creditors and stakeholders, thereby supporting corporate turnaround in times of—even temporary—financial or operational difficulty.

The primary objective is to restore a sustainable economic and financial equilibrium. This aims to enable the Company to address market challenges while seeking to safeguard business continuity, protect employment, maintain dealer relations, and preserve supplier support—all of which represent fundamental pillars for the Company’s long-term sustainability.