Sales at Geox fell 2.2% to €720m ($781.2m) in 2023, which the company attributed to “planned optimisation” of its network and “particularly unfavourable market conditions” in the second half of FY23.

Geox’s chairman and founder Mario Moretti Polegato said that FY23 was “an extremely challenging year” for the company. He said the year was defined by “strong uncertainty arising from the complex macroeconomic framework that directly affected our target market.”.

Polegato added: “Therefore, FY23 looks like a year of stabilisation after the strong increases recorded in the previous two years with sales slightly down from the previous year -2.2% defined at current exchange rates, while, revenues, defined at constant exchange rates up 0.3%.”

CEO departs amid FY23 results

Geox also announced a “mutual separation agreement” with its CEO Libralesso and announced his replacement. Libralesso stood down as CEO on 1 March and will leave Geox on 31 March 2024.

Geox’s new CEO Mistron joins the company after a 25-year career with Italian eyewear conglomerate Luxottica. He is said to have expertise in operations and supply chains.

Mistron said in a statement: “I would like to thank the president and the entire board of directors for the trust they have placed in me and I am honoured to accept this new professional challenge.”

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Key results for Geox in FY23

  • Total sales of €720m, down 2.2% compared to FY2022 at current exchange rates
  • Q4 2023 results were below Q4 2022, with total sales of €138m, down 17.3% at current exchange rates
  • Apparel took up a slightly larger share of Geox’s business in 2023, taking up 10.1% of its total sales, up from 9.9% in 2022.

Wholesales, which accounted for 51.7% of overall sales, totalled €371.8m, up 0.6% at current exchange rates.

Geox’s franchise business accounted for 8.4% of sales, which was a slight decline. Franchises attracted a total of €60.2m in sales, down 5.3% after a decline in the total number of stores from 294 in 2022 to 280 in 2023.

Directly-owned stores, which account for 40% of Geox’s sales also declined in 2023. Sales totalled €287.5m, down 4.9% at current exchange rates. Comparable sales increased 3.7%, as Geox reported “positive results” in physical store sales as well as its online channels.

Polegato added: “Despite the difficulties faced in approaching a market that is increasingly complex and characterised by consequent changes in consumption habits, the group, thanks to the careful and profound process of rationalisation of non-profitable activities and the streamlining of the cost base, has managed to increase its operating margin both in absolute and relative terms, from an EBIT of €4.3m (0.6% of sales) in 2022 to €15.6m (or 2.2% of sales).

What next for Geox?

Geox’s Polegato also pointed out the complexity and uncertainty observed in all of its major markets has persisted even in the first months of the financial year 2024, and means the company needs to “maintain a prudent approach focused on growth in the most profitable markets.”

Geox highlighted that ongoing conflicts in Ukraine and the Middle East could have “significant negative effects” on international demand, inflation and increased energy costs in 2024.

FY23 and Q4 2023 have proven tricky for many apparel and footwear brands, as Rocky Brands sales plummeted after what it called a “challenging” year.

German sports giant Puma also reported declining sales in Q4, as an industry expert suggested reduced sportswear demand weighed on its FY23 sales, which rose by just 1.6%.