Mar 16, 2009
Safilo sees Q1 sales down, no div on 2008 results
Mar 16, 2009
MILAN, March 16 (Reuters) - Italian eyewear maker Safilo (SFLG.MI) said on Monday March 16 it expects to close the first quarter with sales down between 10 percent and 15 percent and would not distribute a dividend on 2008 results.
Safilo, whose main shareholder Only 3T is in talks with potential investors, said in a statement that its 2008 net profit fell 71.3 percent to 14.6 million euros, as demand slowed and high production costs in Italy also weighed.
"We expect to close Q1 2009 with total sales declining between 10 and 15 percent at current currency rates," Chief Executive Roberto Vedovotto told analysts on a conference call.
Safilo, which makes glasses and sunglasses for such designers as Dior, said current market conditions made it difficult to give annual forecasts and that it would provide quarterly updates.
"The first months of 2009 have also been characterised by a difficult performance in all of the group's main markets," Vedovotto said.
Only 3T, which has 39.9 percent of Safilo, said last week contacts were underway with several potential partners and it could dilute its stake but that no deal had been yet outlined.
Safilo's net debt reached 570 million euros in 2009, up from 514.6 million euros at the end of 2007.
Safilo said its Board of Directors has asked the CEO to complete partnerships negotiations so the company could issue the appropriate advisory mandates for the banks.
It said its board approved an industrial reorganisation plan and it would trim production at sites in Italy and Slovenia.
The Italian eyewear industry has been affected by slowing demand due to the global financial crisis.
Rival Luxottica (LUX.MI) posted a 17.6 percent drop in 2008 net profit to 395 million euros and said it would not propose a dividend for now.
Safilo shares closed up 2.35 percent at 0.349 euro before the company's statement came out. ($1=.7737 Euro) (Editing by Karen Foster)
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