MILAN, Italy — Shares in Italian shoes and leather goods company Tod's fell 11 percent on Thursday after the group said sales were still falling and its turnaround was taking longer than envisaged.
Like-for-like sales last month at the group famous for its Gommino loafers were in line with the trend of the previous nine months, which recorded a 2.1 percent fall, suggesting a return to same store sales growth in the fourth quarter may be at risk.
"In the absence of a meaningful inflection point in the top line, we remain sceptical about Tod's turnaround," Berenberg analysts said in a note.
Berenberg, Kepler Cheuvreux, UBS and Mediobanca all cut their target price on the stock after the results, which were released late on Wednesday.
The stock was down 11.1 percent at €48.70 by 11:29 GMT after earlier hitting €48.40, its lowest level in two years.
Chairman Diego Della Valle denied speculation last month about a possible sale of the group, 60 percent owned by his family and valued at around €1.6 billion ($1.8 billion).
Chief financial officer Emilio Macellari told analysts market expectations for full-year revenues were "feasible but challenging" as visibility on the fourth quarter was limited.
Analysts had been forecasting 2018 sales of around €960 million but several already said they might review their forecasts after the third quarter. For January-September Tod's posted sales of €706 million.
The company had said earlier this year that a new strategy focused on more collections and classic looks would yield results from the second half of 2018.
But on Wednesday, Macellari said the turnaround strategy was taking longer than expected, although there were some positive signs already and the response to initial products by new designer Gherardo Felloni was "very good".
By Agnieszka Flak; editor: Keith Weir.