RAPAPORT... Bulgari announced its fourth-quarter and fiscal-year results today after the markets closed in Europe. Bulgari's total sales fell 9.8 percent in the fourth quarter to EUR 312.6 million ($412.6 million); using constant exchange rates, total sales dropped 15.5 percent. Jewelry sales for the three months ending December 31, 2008, declined 12.8 percent to EUR 129.3 million ($170.7 million), and at constant exchange rates they were down 17.3 percent. Watch sales decreased 21.2 percent to EUR 72 million ($95 million), a 28 percent drop at constant exchange rates.
The steepest fall in sales during the fourth quarter was reported out of Europe, where sales were down 16.8 percent. Bulgari reported that sales declined 6.9 percent in Asia and decreased 4.8 percent in the Americas. Sales rose 11.1 percent in the Middle East.
For the full year, jewelry sales fell 2.6 percent to EUR 448.2 million ($591.6 million), and dropped 1.5 percent using constant exchange rates. Watch sales declined 10.5 percent to EUR 263.8 million ($348.2 million), and total company sales were down 1.5 percent to EUR 1.075 billion ($1.42 billion).
By geographic region, Bulgari experienced its steepest sales drop for the full fiscal year in the Americas, where they were down 12.5 percent. Sales decreased 1.4 percent in Europe, but grew 1.6 percent across Asia and were up by 9.1 percent across the Middle East. Full-year profits for fiscal 2008 will be announced on March 11, 2009.
Francesco Trapani, chief executive officer (CEO) of the Bulgari Group, said, “Also for our company, the nasty economic environment had a strong negative effect on the holiday season’s sales. It is therefore evident that this situation will be inevitably reflected in a decrease of the 2008 profits higher than the one showed at the end of the first nine months of the year. I would like to underline that, differently from what some important competitors have done, Bulgari has not reduced its selling prices and has not changed its discount policy with the final client and trade in order to protect the integrity of the brand in the long term. Considering the results of the last months and expecting a very difficult 2009, the company is further committed to be as efficient as possible by reassessing the costs and investments structure in order to defend its profitability and cash flow as much as possible.”