Securities
and Exchange Commission
Washington,
D.C. 20549
Form
6-K
Report
of Foreign Issuer
Pursuant
To Rule 13a-16 Or 15d-16
Of
The
Securities
Exchange Act of 1934
For the month of
APRIL 2019
|
|
Commission File Number 1-11854
|
NATUZZI S.p.A.
|
(Translation of registrant's name
into English)
|
Via Iazzitiello 47
|
70029 Santeramo, Italy
|
(Address of principal office)
|
Indicate by
check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F:
Form
20-F
⊠
Form 40-F
⃞
Indicate by
check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act
of 1934. Yes
⃞
No
⊠
If "Yes" is
marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
Natuzzi
S.p.A.: Unaudited Consolidated Results for the Fourth Quarter and Full
Year 2018
INTERNATIONAL
FINANCIAL REPORTING STANDARDS FIRST ADOPTION
-
2018
FULL YEAR OPERATING RESULT OF -€25.5 MILLION
-
2018
FULL YEAR NET PROFIT OF €33.3 MILLION THANKS TO EXTRAORDINARY INCOME
-
GROUP’S
NET FINANCIAL POSITION POSITIVE AT €6.0 MILLION AS OF DEC. 31, 2018
-
NET OF
RESTRUCTURING COSTS, Q4 2018 OPERATING LOSS IMPROVING VERSUS FIRST
THREE QUARTERS OF 2018
-
Q4 2018
DIRECT RETAIL OPERATIONS IMPROVING ON A LIKE-FOR-LIKE BASIS
-
REORGANIZATION
OF THE ITALIAN WORKFORCE IN 2019
SANTERAMO IN COLLE, Bari, Italy--(BUSINESS WIRE)--April 10, 2019--The
Board of Directors of Natuzzi S.p.A. (NYSE:NTZ) (“Natuzzi” or the
“Company”) today presented and approved its 2018 fourth quarter and full
year unaudited consolidated financial results and the Company’s draft
financial statements.
IFRS adoption
As previously announced, unaudited consolidated financial statements are
presented according to the International Financial Reporting Standards
(IFRS) as issued by IASB.
Natuzzi’s has resolved to voluntarily adopt International Financial
Reporting Standards (IFRS) for its consolidated financial statements
from the fiscal year ended December 31, 2018, in place of the Italian
Generally Accepted Accounting Principles (ITA-GAAP). The financial
information reported herein should be considered to be preliminary until
Natuzzi files its annual report on Form 20-F for the fiscal year ended
December 31, 2018.
2018 fourth quarter results
Consolidated revenues for the fourth quarter of 2018 were €115.2
million, down 4.1% from 2017 same period.
Upholstery and furnishings net sales were €110.4 million, down 2.5% from
last year same period as a result of the 4.9% decrease in upholstery net
sales (at €96.5 million), partially offset by the 18.4% increase in
furnishings sales (at €13.9 million).
Other sales were €4.8 million in fourth quarter 2018, versus €6.9
million in 2017 fourth quarter.
1.
Natuzzi division
The Natuzzi division sales includes
Natuzzi Italia
,
Natuzzi
Editions
and
Divani&Divani by Natuzzi
, distributed
through both direct retail network and third-party operated points of
sales.
Fourth quarter net sales of this division were €86.3 million, down 2.0%
from €88.0 million in 2017 same period. The Americas went up 15.2%,
while the EMEA region registered a -11.0% over 2017 fourth quarter.
Within the Natuzzi division,
Natuzzi Italia
net sales increased
by 2.9% over 2017 comparable period and represents 37.0% of the entire
Group’s core business (as compared to 35.1% in prior year fourth
quarter). Notably,
Natuzzi Italia
net sales have increased for
nine consecutive quarters.
The
Divani&Divani by Natuzzi
network grew by 3.6% over 2017
fourth quarter.
On the contrary,
Natuzzi Editions
net sales decreased by 7.9%
over 2017 same quarter, due in particular to weak performance in some
European Countries.
1.a Natuzzi division: Direct retail
Within the above-mentioned Natuzzi division, the Group directly operates
points of sales, under both
Natuzzi Italia
and
Divani&Divani
by Natuzzi
name.
As previously disclosed, following the execution of the partnership in
China, the 11
Natuzzi Editions
Directly Operated Stores (“DOS”)
were transferred and, consequently, are no longer considered in the
consolidated financial statements. Therefore, the following direct
retail division numbers are displayed accordingly.
During 2018, we opened 6
Natuzzi Italia
DOS, of which 3 in the
USA, 2 in France and 1 in the UK.
As of the day of this press release, the Directly Operated points of
sale are 66, of which 39 DOS
Natuzzi Italia
, 15 DOS
Divani&Divani
by Natuzzi
and 12
Natuzzi Italia
concessions in Mexico,
having recently closed 8 concessions in UK.
During the fourth quarter of 2018, net sales generated by the direct
retail division were €16.8 million, up 4.4% over the same period of last
year, with positive sales numbers in particular in the USA (+46.0%),
Italy (+19.5%) and Switzerland (+22.2%).
Q4 2018 sales on a like-for-like basis were €12.9 million, up 10.6% from
€11.6 million in the last quarter of 2017, thanks in particular to the
performance of our DOS located in the USA (+32.7%), Italy (+19.6%) and
Switzerland (+25.3%).
1.b Natuzzi division: wholesale
Natuzzi Sales generated by the wholesale channel (Natuzzi franchised
operated stores, “FOS”, and other selling formats), were €69.5 million,
down 3.4% from €72.0 million for the last quarter of 2017.
Within this wholesale channel,
Natuzzi Italia
sales were €28.2
million, up 3.9%,
Natuzzi Editions
sales were €37.0 million, down
7.9%, and sales from
Divani&Divani by Natuzzi
network were
€4.3 million, down 6.6% compared to fourth quarter 2017.
We recently launched a new store concept for the
Natuzzi Editions
business with the recent openings in Cardiff, Wales, and Glasgow,
Scotland, showcasing the most recent
Natuzzi Editions
collections
in a completely renovated retail environment. These two openings are
intended to lay the foundations for the
Natuzzi Editions
expansion through the mono brand stores.
This new
Natuzzi Editions
retail concept has just been displayed
at the High Point fair and is intended to be the crucial driver for the
distribution in the USA.
2.
Softaly
Sales generated by this division, addressing the low-end segment of the
market, were €24.1 million, from €25.2 million in 2017 fourth quarter.
The Company’s aim for this division is to focus primarily on a few
selected primary customers.
Q4 2018 Gross margin
During the fourth quarter of 2018, the consolidated gross margin was
27.4%, from 28.9% in prior year fourth quarter.
The Company has continued to restructure its Italian operations. For
this reason, cost of sales in the last quarter of 2018, which has passed
from 71.1% on revenues to 72.6%, was penalized by €5.6 million of costs
pertaining, in particular, the incentive program to reduce the
workforce. In the prior year fourth quarter, the Company incurred in
only €0.8 million of similar costs included in the cost of sales.
Net of the above-mentioned costs and also thanks to a favorable trend in
raw material prices in Q4 2018, cost of sales would have been 67.7% from
70.4% in 2017 fourth quarter, and gross margin would have increased at
32.3% on revenues versus 29.6% in 2017 same period.
Q4 2018 Selling and Administrative expenses
Selling and Administrative expenses were €40.4 million (or 35.0% on
revenues) from €40.9 million (or 34.1% on revenues) in last year same
period, affected by costs of €1.3 million for a similar incentive
program to reduce the workforce in the Headquarters as described above.
Q4 2018 operating results
The Group reported an operating loss of €8.9 million, versus an
operating loss of €6.3 million in 2017 fourth quarter. Excluding the
€6.9 million of the already mentioned costs, for 2018 fourth quarter the
Group would have reported an operating loss of €2.0 million.
2018 Full year results
Total Consolidated net revenues for full year 2018 were €428.5 million,
down 4.5% from €448.9 million in 2017, or down 1.8% under constant
exchange rates.
The Company reported a yearly operating loss of €25.5 million (or a
€21.7 million, net of the currency effect) versus an operating loss of
€24.0 million in 2017.
On July 27, 2018, the partnership agreement with KUKA Furniture (Ningbo)
Co., Ltd. was finalized and consequently the Natuzzi Trading Shanghai
Co. Ltd. was deconsolidated. As a consequence of this disposal, the
Company accounted extraordinary income under the “
Gain from
disposal and loss of control of a subsidiary
” caption within the
unaudited consolidated profit and loss statement, for a total of €75.4
million.
Thanks to this extraordinary income, Net Profit attributable to the
Owners of the Company in 2018 was €33.3 million.
As of December 31, 2018, cash and cash equivalents, net, for the Group
was €60.4 million, from €55.0 million at the end of 2017, and the
Group’s net financial position (cash – short and long term borrowings)
was positive by €6.0 million compared to €3.4 million at the end of 2017.
Chairman and CEO Pasquale Natuzzi commented: “
The global
competitive environment and the fast-changing consumers’ habits have
greatly affected our industry over the years. The traditional wholesale
distribution channel has been struggling over the last few years in
adapting its business model to the such new challenges.
In this regard, we are all aware of the increasing difficulties that
in some cases have led to a significant downsizing of the business or to
more drastic consequences, as much in the USA as in Europe, of some big
players in the distribution.
On the other hand, most of our competitors have already switched from
a wholesale business to a retail-based business, and hence to a
distribution model that is mainly controlled by means of a mono-brand
store network.
This new context has implied a radical transformation of our Group,
still ongoing.
In 2019, we will continue to expand our mono-brand store network.
While the Natuzzi Italia network is delivering overall positive results,
we will focus our efforts also in enhancing the productivity of the
Natuzzi Editions stores. We have just finalized the Natuzzi Editions
retail business model and store concept which was presented in January
during the Cologne exhibition, raising interest among dealers, and
nowadays also at the High Point fair. We are now particularly focused on
leveraging the investments done in the new Natuzzi Editions retail
format by opening stores in UK, USA, Australia, Italy and, of course, in
China with our partners.
While we continue with the execution of the retail strategy, 2019
will see, on the contrary, a significant change in the organizations of
our Italian industrial operations that will start reducing manufacturing
cost starting from Q2 2019. We’ll continue to focus on the supply chain,
whose improving efficiency has been already visible in Q4 2018.
Such reduction in the Italian labor cost, together with the increased
efficiency in the supply chain, improvement in the sales mix and a more
favorable trend in raw materials, are the basis for the profitability
improvement targeted for this year. However, we are aware that the still
ongoing discussions about tariffs and the worsening of the economic
environment continue to generate uncertainty.”
The Company’s Board of Directors today also resolved to propose at the
next Company’s ordinary and extraordinary shareholders’ meeting, which
is expected to be held on April 29, 2019 (first call), or May 2, 2019
(second call), the following items on the agenda:
-
The appointment of the Company’s External Auditors and the Board of
Statutory Auditors both for the three-year period from 2019 to 2021;
-
The authorization for a share-based incentive plan for certain
managers and directors of the Company and other companies within the
Natuzzi Group;
-
An American Depositary Receipts (“ADR”)/Share buyback program.
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
Certain statements set forth in this press release constitute
forward-looking statements within the meaning of the safe harbor
provisions of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. These
statements involve risks and uncertainties that could cause the
Company’s actual results to differ materially from those stated or
implied by such forward-looking statements. More information about the
potential factors that could affect the Company’s business and financial
results is included in the Company’s filings with the Securities and
Exchange Commission, including the Company’s most recent Annual Report
on Form 20-F. The Company undertakes no obligation to update any of the
forward-looking statements after the date of this press release.
About Natuzzi S.p.A.
Founded in 1959 by Pasquale Natuzzi, Natuzzi S.p.A. is Italy’s largest
furniture house and one of the most important global players in the
furniture industry with an extensive manufacturing footprint and a
global retail network. Natuzzi is the European lifestyle best-known
brand in the upholstered furnishings sector worldwide (Brand Awareness
Monitoring Report - Ipsos 2018) and has been listed on the New York
Stock Exchange since May 13, 1993. Always committed to social
responsibility and environmental sustainability, Natuzzi S.p.A. is ISO
9001 and 14001 certified (Quality and Environment), OHSAS 18001
certified (Safety on the Workplace) and FSC
®
certified
(Forest Stewardship Council).
https://www.natuzzigroup.com/en-EN/ir/presentation.html
NATUZZI’S HAS RESOLVED TO VOLUNTARILY ADOPT INTERNATIONAL FINANCIAL
REPORTING STANDARDS (IFRS) FOR ITS CONSOLIDATED FINANCIAL STATEMENTS
FROM THE FISCAL YEAR ENDED DECEMBER 31, 2018, IN PLACE OF THE ITALIAN
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (ITA-GAAP). THE FINANCIAL
INFORMATION REPORTED HEREIN SHOULD BE CONSIDERED TO BE PRELIMINARY UNTIL
NATUZZI FILES ITS ANNUAL REPORT ON FORM 20-F FOR THE FISCAL YEAR ENDED
DECEMBER 31, 2018.
|
Natuzzi S.p.A. and Subsidiaries
|
|
Unaudited Consolidated Profit & Loss for the fourth quarter of
2018 & 2017 on the basis of IFRS -IAS
|
|
(expressed in millions Euro)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended on
|
|
Change
|
|
Percentage of Sales
|
|
|
|
31-Dec-18
|
|
31-Dec-17
|
|
%
|
|
31-Dec-18
|
|
31-Dec-17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
115.2
|
|
120.1
|
|
-4.1%
|
|
100.0%
|
|
100.0%
|
|
Cost of Sales
|
|
(83.6)
|
|
(85.3)
|
|
-2.0%
|
|
-72.6%
|
|
-71.1%
|
|
Gross profit
|
|
31.6
|
|
34.7
|
|
-9.1%
|
|
27.4%
|
|
28.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
|
|
1.1
|
|
0.0
|
|
|
|
|
|
|
|
Selling Expenses
|
|
(30.1)
|
|
(30.4)
|
|
-0.9%
|
|
-26.1%
|
|
-25.3%
|
|
Administrative expenses
|
|
(10.3)
|
|
(10.5)
|
|
-2.5%
|
|
-8.9%
|
|
-8.8%
|
|
Impairment on trade receivables and contract asset
|
|
(0.6)
|
|
0.0
|
|
|
|
|
|
|
|
Other expenses
|
|
(0.6)
|
|
(0.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit/(loss)
|
|
(8.9)
|
|
(6.3)
|
|
|
|
-7.7%
|
|
-5.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net finance income/(costs)
|
|
(2.6)
|
|
(0.6)
|
|
|
|
|
|
|
|
Share of profit of equity-accounted investees, net of tax
|
|
(0.5)
|
|
0.0
|
|
|
|
|
|
|
|
Gain from disposal and loss of control of a subsidiary
|
|
0.0
|
|
0.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(Loss) before tax
|
|
(12.0)
|
|
(6.9)
|
|
|
|
-10.4%
|
|
-5.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
(0.5)
|
|
0.2
|
|
|
|
-0.4%
|
|
0.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(Loss) for the period
|
|
(12.5)
|
|
(6.7)
|
|
|
|
-10.8%
|
|
-5.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(Loss) attributable to:
|
|
|
|
|
|
|
|
|
|
Owners of the Company
|
|
(12.3)
|
|
(6.6)
|
|
|
|
-10.7%
|
|
-5.5%
|
|
Non-controlling interests
|
|
(0.2)
|
|
(0.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) per Ordinary Share
|
|
(0.22)
|
|
(0.12)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*) Purchases plus beginning stock minus final stock and leather
processing
|
|
|
Natuzzi S.p.A. and Subsidiaries
|
|
Unaudited Consolidated Profit & Loss for the twelve months of
2018 & 2017 on the basis of IFRS-IAS
|
|
(expressed in millions Euro)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months ended on
|
|
Change
|
|
Percentage of Sales
|
|
|
|
31-Dec-18
|
|
31-Dec-17
|
|
%
|
|
31-Dec-18
|
|
31-Dec-17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
428.5
|
|
448.9
|
|
-4.5%
|
|
100.0%
|
|
100.0%
|
|
Cost of Sales
|
|
(308.2)
|
|
(318.4)
|
|
-3.2%
|
|
-71.9%
|
|
-70.9%
|
|
Gross profit
|
|
120.3
|
|
130.5
|
|
-7.8%
|
|
28.1%
|
|
29.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
|
|
5.9
|
|
1.7
|
|
|
|
|
|
|
|
Selling expenses
|
|
(115.0)
|
|
(118.3)
|
|
-2.8%
|
|
-26.8%
|
|
-26.3%
|
|
Administrative expenses
|
|
(35.3)
|
|
(36.1)
|
|
-2.1%
|
|
-8.2%
|
|
-8.0%
|
|
Impairment on trade receivables and contract asset
|
|
(0.7)
|
|
(1.5)
|
|
|
|
|
|
|
|
Other expenses
|
|
(0.6)
|
|
(0.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit/(loss)
|
|
(25.5)
|
|
(24.0)
|
|
|
|
-5.9%
|
|
-5.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net finance income/(costs)
|
|
(9.1)
|
|
(4.0)
|
|
|
|
|
|
|
|
Share of profit/(loss) of equity-accounted investees, net of tax
|
|
(0.3)
|
|
0.0
|
|
|
|
|
|
|
|
Gain from disposal and loss of control of a subsidiary
|
|
75.4
|
|
0.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(Loss) before tax
|
|
40.5
|
|
(28.0)
|
|
|
|
9.5%
|
|
-6.2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
|
|
(7.4)
|
|
(2.9)
|
|
|
|
-1.7%
|
|
-0.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(Loss) for the period
|
|
33.1
|
|
(30.8)
|
|
|
|
7.7%
|
|
-6.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(Loss) attributable to:
|
|
|
|
|
|
|
|
|
|
Owners of the Company
|
|
33.3
|
|
(30.4)
|
|
|
|
7.8%
|
|
-6.8%
|
|
Non-controlling interests
|
|
(0.2)
|
|
(0.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(Loss) per Ordinary Share
|
|
0.61
|
|
(0.55)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*) Purchases plus beginning stock minus final stock and leather
processing
|
|
Natuzzi S.p.A. and Subsidiaries
|
|
Unaudited Consolidated Balance Sheets (Condensed) on the basis of
IFRS-IAS
(Expressed in millions of Euro)
|
|
|
|
|
|
|
|
|
|
31-Dec-18
|
|
31-Dec-17
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
Non-current assets
|
|
165.6
|
|
126.0
|
|
Current assets
|
|
207.1
|
|
206.6
|
|
TOTAL ASSETS
|
|
372.7
|
|
332.5
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
Shareholders' equity
|
|
136.5
|
|
102.5
|
|
Non-controlling interests
|
|
1.6
|
|
2.0
|
|
Non Current Liabilities
|
|
66.1
|
|
73.1
|
|
Current liabilities
|
|
168.4
|
|
154.9
|
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
372.7
|
|
332.5
|
Natuzzi S.p.A. and Subsidiaries
|
Unaudited Consolidated Statements of Cash Flows (Condensed)
|
(Expressed in millions of Euro)
|
|
31-Dec-18
|
|
31-Dec-17
|
|
|
|
|
|
Cash flows from operating activities
|
|
|
|
|
Profit for the period
|
|
33.1
|
|
(30.8)
|
|
|
|
|
|
Net cash provided by (used in) operating activities
|
|
(11.3)
|
|
(4.9)
|
|
|
|
|
|
Net cash provided by (used in) investing activities
|
|
14.6
|
|
(10.4)
|
|
|
|
|
|
Net cash provided by (used in) financing activities
|
|
2.2
|
|
12.4
|
|
|
|
|
|
Increase (decrease) in cash and cash equivalents
|
|
5.4
|
|
(2.9)
|
|
|
|
|
|
Cash and cash equivalents, beginning of the year
|
|
55.0
|
|
60.6
|
|
|
|
|
|
Effect of movements in excahnge rates on cash held
|
|
(0.1)
|
|
(2.6)
|
|
|
|
|
|
Cash and cash equivalents, net, end of the period
|
|
60.4
|
|
55.0
|
|
|
|
|
|
|
|
|
|
|
For the purpose of the statements of cash flow, cash and cash
equivalents comprise
the following:
|
(Expressed in millions of Euro)
|
|
31-Dec-18
|
|
31-Dec-17
|
Cash and cash equivalents, end of the period
|
|
62.1
|
|
55.0
|
Bank overdrafts repayable on demand and used for cash
management
purposes
|
|
(1.8)
|
|
0.0
|
Cash and cash equivalents, net, end of the period
|
|
60.4
|
|
55.0
|
CONTACT:
NATUZZI INVESTOR RELATIONS
Piero Direnzo | tel.
+39.080.8820.812 |
pdirenzo@natuzzi.com
NATUZZI CORPORATE COMMUNICATION-
Vito Basile (Press Office) |
tel. +39.080.8820.676 |
vbasile@natuzzi.com
SIGNATURES
Pursuant to
the requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
|
|
|
NATUZZI S.p.A.
|
|
|
|
|
|
|
|
(Registrant)
|
|
|
|
|
Date:
|
APRIL 10, 2019
|
By:
|
/s/ Pasquale Natuzzi
|
|
|
|
Pasquale Natuzzi
|
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