The market value of the glasses giant Safilo is only 400 million, and the industry revolution has made it extremely emba

The market value of the glasses giant Safilo is only 400 million, and the industry revolution has made it extremely embarrassed

In the era of great changes in the eyewear industry,

Italian eyewear manufacturer Safilo Group SpA (SFL.MI) Safilo Group's position is declining

As a result, the Group's actual revenue declined.

On January 31, Safilo Group SpA disclosed its preliminary results for the full year,

The group's sales in 2016 fell by 2.0 percent to 1,252.8 million euros

In the same period of 2015, it was 1,279.0 million euros, a decrease of 1.2% at constant exchange rates.

Excluding the discontinued agency business and denominated sales in euros, the increase was 3.6 percent.

Italian eyewear manufacturer Safilo Group SpA Safilo Group SpA The eyewear industry in which Safilo Group operates is undergoing a profound transformation.

On the one hand, large groups with multiple independent brands are gradually reclaiming agency rights

On the one hand, mergers and acquisitions between giants have intensified, which has led to an even more awkward position for Safilo Group SpA.

In 2016, Safilo Group SpA was the world's second largest manufacturer of fashion eyewear and the third largest manufacturer of eyewear in the world.

However, this pattern was completely broken in 2017.

Luxottica Group SpA (MTA:LUX; NYSE: LUX) Luxottica Group and Essilor International SA (EI. PA) announced in mid-January that Essilor Group will merge to form a new company, Essilor Luxottica.

After the merger, Safilo Group SpA became the world's second largest eyewear manufacturer

However, its competitors are getting stronger and stronger, and its position as the number one in the industry is even more unshakable.

According to the data of no fashion Chinese, in 2015, the revenue of Luxottica Group SpA was 9.011 billion euros.

No. 1 in the industry; Essilor SA generated revenues of €6,716 million in fiscal 2015

Net profit of 757 million euros ranked second in the industry.

However, Safilo Group SpA's position as the second largest in the industry is not guaranteed.

Currently, Kering SA (KER. PA) Kering has established an eyewear business unit

Gucci, the brand previously represented by Safilo Group SpA, will start operating its own brand in 2017.

In addition to Gucci, Kering SA also owns Bottega Veneta, Saint Laurent, Stella McCartney, Alexander McQueen, Balenciaga, Boucheron and other brands.

Once Gucci's eyewear business is successful, the group will continue to recycle the eyewear business.

Even more detrimental to Safilo Group SpA is that

Its largest client, LVMH Mo?t Hennessy Louis Vuitton SE (MC.PA) Mo\x{00eb}t Hennessy-Louis Vuitton Group, is also looking for an in-house eyewear strategy

or indirectly self-employed through shareholding.

Previously, it was rumored that LVMH SE was about to acquire a 10% stake in Italian eyewear manufacturer Marcolin SpA.

Bernard Arnault, CEO of LVMH SE, was also asked by analysts at the group's earnings conference at the end of the month.

However, he refused to answer, saying only that even the acquisition was a small transaction.

Marcolin SpA, which is currently controlled by private equity fund PAI Partners SAS, has a maximum valuation of 500 million euros.

This means that LVMH SE's investment is 50 million euros.

The LVMH SE brands represented by Safilo Group SpA include Christian Dior, Fenci, Givenchy, Céline and Marc Jacobs.

At the end of 2016, Safilo Group SpA announced that its dealership agreement with Céline would be terminated on December 31, 2017.

At the same time, the contract with the Christian Dior Couture brand was renewed until December 31, 2020.

This updated agreement has also attracted market attention.

The industry believes that LVMH SE will hand over Céline to Marcolin SpA.

Sources also said that LVMH SE may form a joint venture with Marcolin SpA to operate the former's full eyewear business.

This is also in line with the trend of luxury brands increasing supplier control to improve margins and secure supply.

The Céline brand business currently accounts for 3% of Safilo Group SpA's revenue.

This means an annual income of around 38 million euros.

Marcolin SpA has clients such as Tom Ford, Balenciaga, Montblanc, Roberto Cavalli, Just Cavalli, Dsquared2, Tod's and Diesel.

In 2012, PAI Partners SAS acquired approximately 80% of the group

At that time, it was valued at 282 million euros.

In order to make up for the continuous loss of heavyweight customers in recent years, Safilo Group SpA strives to "solicit customers".

In 2016, he signed new brands such as Rag & Bone, Moschino, Love Moschino and Swatch

It also works with Max Mara and Jimmy Choo PLC (CHOO. L) Early renewal of contracts for two established customers until 2023.

In addition, Safilo Group SpA announced at the end of last year that it had signed an agreement with Interaxon Inc., a company with sensing technology.

The Italian company that will develop wearables also proudly named the project SAFILOX.

Safilo Group SpA (SFL.MI) shares plunged again on Wednesday due to declining revenues.

It fell 7.50% to 6.35 euros, with a market capitalization of only 400 million euros.

The stock has plunged 20% so far this year.

This article is from the No Fashion Chinese Network, slightly modified,

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