ITALY: Fila Points Finger At South America After Profits Slide
Leading Italian-based sportswear, footwear and casual wear designer, Fila Holding SpA, today announced a third quarter net loss of $31.8m, compared with a net income of $2.4m during the same period last year.
The company said gross profit for the quarter was 99.9m euros, representing 34.9 per cent of total net revenues, compared to 124.4m euros - 40.9 per cent of total net revenues - in the third quarter of 2000.
Fila bosses blamed the fall in profits on a collapse in South American markets, competitive weakness in some key European markets, emphasised by the uncertain economic outlook, and a clearance of excess inventory in the Far East and Europe.
Chief executive officer, Michele Scannavini, said: "Recent events and negative changes in economic and industry conditions in markets where Fila had expected to improve substantially in the second semester of this year (particularly the US and South America) have impacted on Fila's expectations.
"These factors, coupled with the persisting difficulties in some key European markets, the substantial effort underway to improve the group's inventory situation and the depreciation of the Korean Won against the Euro, have significantly affected the operating level in the third quarter. We are finalising the assessment of these factors' impact on full year 2001."
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