Salvatore Ferragamo has named former Kering executive Micaela le Divelec Lemmi as its new CEO although it’s less of a change than it might have been given that she has been general manager of the company since the spring.
Le Divelec Lemmi, who had been CFO of Kering’s wildly successful Gucci brand, takes up the new role immediately, the Italian luxury company said.
Ferragamo had been without a CEO since February when Eraldo Poletto stepped down, with the firm and the outgoing executive disagreeing over strategy.
The new chief must now inject some dynamism into the brand with results proving lacklustre in recent periods. As it announced its new appointment, the company also said its first half revenue was down 3.4% currency-neutral or 6.2% on a reported basis to €674 million, lower than the €685 million that analysts had predicted. Retail sales fell 5.2% and wholesale was down 7.6%.
Europe and North America both declined and even Asia Pacific revenue dropped 5.5% with China down 1%, although the firm’s own Chinese stores rose 15.5% and Hong Kong rose 32% currency-neutral. Ebitda fell 14.5% to €117 million while net profit dropped 23.1% to €59 million.
A revival really is needed at Ferragamo. In the first half, sales of the product category on which the firm was founded, footwear, fell 5.5% to €285.6 million, while leather bags and accessories edged up only 1.6% to €262.7 million. Perfume fell 8.9% to €38.7 million, despite the launch of its major new scent Amo.
To reverse this decline, Poletto, who has since moved on to become CEO of the Stuart Weitzman brand at Tapestry Inc, had wanted the company to focus more of the firm’s investment cash on digital sales and marketing.
Will the new CEO follow that path? She hasn’t shared her strategy yet but her 20 years of experience at Gucci will certainly have shown her just how a brand can be revived and turned into a must-have.