Welcome, everybody. 2023 looks like a year of stabilization and moderate growth after the strong increases recorded in the previous two years. Sales reached EUR 582 million, up 2.3% at current exchange rates, 4.1% at constant exchange rates, compared to the first nine months of 2022. This result was due to the good performance of sales in the multi-brand channel, combined with a positive performance of our stores' comparable sales. This allowed us to offset both negative impact, optimization of the perimeter of the stores in terms of sales, and the difficulties resulting from the unusual weather conditions that occurred both in May and September. This result gave more value, considering that it was achieved in a complex macroeconomic situation characterized by strong geopolitical tensions, high interest and inflation rates that induces strong concerns and more cautious behaviors.
The group continued to invest in the most strategically important areas of the business, including marketing, digital, and product innovation. In this regard, in September, a major strategic marketing initiative was unveiled. The Oscar-winning actress, Penélope Cruz, was named Global Brand Ambassador of Geox. This collaboration project reflects and emphasizes the distinctive traits that unite the Oscar-winning actress and our brand by placing even greater emphasis on style, comfort, and quality, which have always been Geox founding values. In addition, we firmly believe that the strong double-digit bounce in sales recorded in October, November, is related to the strategic evolution of Geox toward the new lifestyle brand positioning. Net financial position and working capital are still under control because of strict inventory control, rigorous management of both interest rate and currency hedges.
In any event, the scenario's complexity forces us to continue taking a cautious approach that is centered on strict cost management and seeking for additional improvements. Thank you. Please, Livio, go on.
Thank you. Good morning and good afternoon. Thank you for joining us today to discuss nine-month sales, net financial position, current trading, and some trends expected for full year 2023. Let's start with line number three, with the executive summary. So net sales at EUR 582 million, up 4.1% versus last year at constant exchange, and 2.3% reported. Net working capital amounts to EUR 177 million versus EUR 123 million in September last year, due to the complexity completely different dynamics in flows of payments to suppliers that will be reabsorbed in the next two quarters.
Consequently, the adjusted net financial position before IFRS 16 lease liabilities was -EUR 129 million as a result of a bank debt of EUR 139 million, and a positive mark-to-market of hedging instruments of EUR 10 million. In September last year, bank debt was EUR 114 million, and the positive value of derivatives was EUR 70 million. Let's move to page 4 to comment our new global ambassador project. It is a new chapter in the marketing strategies of Geox brand, the star who fits our shoes perfectly. The goal of this project are to grow brand awareness and build emotional connection with our, our audience, to keep pursuing the path of a premium lifestyle brand, and to unlock the real business potential of a woman market. The result we have been able to obtain are outstanding, in my opinion.
I would say a worldwide star and a worldwide brand-led, brand-led to a worldwide successful marketing campaign. Please go to page five to comment current trading, that has been materially improved by this strategic evolution towards this new lifestyle brand positioning. But let's start examining the key factors of the third quarter. Comparable sales in July and the first half of August have been positive, high single-digit. Then the unusually hot weather condition delayed the start of a fall/winter season, and starting from second half of August until the end of September and the first week of October, the performances worsened at -10%. Then the weather condition normalized. In addition, Geox unveiled the marketing project and started the marketing campaign worldwide.
So performances in the remaining part of October have been really positive, high double-digit in the region of 25-30%, and this trend keeps going in November to date with a +15% . All in all, week 44 to date, comparable store sales are +3% on last year and 4% on 2019. Let's comment wholesale current trading also. Looking in the box down at your right, you see that wholesale is up 8%, 8% September year to date, thanks also to an easy comparison base. Last year, as you may remember, we experienced material delays in deliveries, so we shipped a lot of products in October. This year, supply chain fully recovered the performances, and we shipped the most of the product b September.
In addition, the fourth quarter will be also penalized by expected lower reorders due to the latest start of the season. So wholesale, at the end of the week, October, is up 3%, and we consider this as a good proxy for full-year growth in this channel. In the next page, there is the status of the optimization of brick-and-mortar retail network. During the last 12 months, we closed approximately 60 stores, affecting sales this year by EUR 12 million, however, with no impact on profitability. Today, the network is composed by 656 stores, out of which 261 are DOS, and this optimization has been almost completed. No material differences within the year-end. Please go to chart number seven to give some flavor to top line split between brick-and-mortar and digital.
The growth is, the total growth is, EUR 13 million. This growth is totally due to brick-and-mortar, while digital sales, including our direct e-commerce and the other web players, are slightly negative. This trend in digital is fully aligned with market trends and reflects the stabilization of volumes after two years of overperformance due to the severe lockdown in brick-and-mortar. Total digital sales, however, represent 26% of total turnover, in line with the best practice in our industry. However, remarkable to say, these last four weeks have been able to turn positive the sales of our digital channel for the entire 2023 to date, covering the gap with last year.
I mean, in the last 4 weeks in a row, a growth in the region of 40%-50% per week, and these are present, in my opinion, a clear sign that the marketing campaign and the ambassador project is really driving good results, driven by women, that is really growing. Please go to page eight to comment top line split between B2B and B2C, dynamics at constant exchange. There is a head wind due to the ruble devaluation in the region of EUR 10 million in nine months. It will be in the region of EUR 13 million to EUR 15 million at year-end. Wholesale and franchising together delivered a 9% growth, mainly as a result of positive initial orders and better timing in deliveries.
The U.S. and web together are at -3.6%, driven by a positive like-for-like 3% as disclosed, but more than offsetting by the planned perimeter reduction, resulting in the already commented six net closures of EUR 12 million. At page nine, there are, just for your reference, the numbers split by channel. Nothing to add to what already disclosed, so please go to page 10, where there is a very quick overview to net sales by region. Italy was up 6%, supported by a double-digit growth from wholesale, while franchising in the U.S. top line have been driven by negative perimeter effect. Europe is down mid-single digit, suffering lower reorders from the big online players like Amazon and Zalando, and also our brick-and-mortar and digital suffered in Germany and in Switzerland, where recession is stronger than in the rest of Europe.
In North America, the performances of all channels are positive, mid to high-single-digit, but this does not compensate the completion of the brick-and-mortar rationalization in Canada. Rest of the world is positive in all the geographies. Asia Pacific in the region of low-double-digit, Eastern Europe countries, double-digit, and stronger performance in Middle East, high-double-digit. On page 11, there is the details of net sales by product. Just to say that footwear grew 1.7%, while ready-to-wear grew close to 8%. We are confident that in the fourth quarter, ready-to-wear will deliver good results due to the fact that the comparison base is easy. If you remember, last year, we incurred a fire event in the fourth quarter. Please go to chart number 13 to comment working capital and net financial position evolution.
Net Financial Position before IFRS 16 stood at EUR 129 million as a result of a bank debt amounting to EUR 139 million, EUR 25 million more than September last year, and a positive fair value of hedging instruments amounting to EUR 10 million. This EUR 25 million increase in debt is totally driven by Net Working Capital seasonal dynamics. Net Working Capital amounts to EUR 177 million, up from EUR 123 million in September 2022. Inventories are lean and under control at EUR 259 million, totally in line with the previous year, and mainly referred finished goods related to the current and future season. So no issue regarding inventory. Also, receivables are very healthy at EUR 155 million versus EUR 144 million in September last year, despite the 8% growth of third-party sales.
We are also delivering a slight improvement in average collection days. The increase in Net Working Capital is therefore exclusively related to the significant reduction in trade payables, approximately EUR 50 million, due to the improved efficiency of the supply chain that enabled the receiving of finished products earlier than in previous year, with the consequent anticipation of payment deadlines . This made it possible to provide an excellent level of service to the market and to reduce cancellations due to late deliveries that impacted last year. This time issue will be, in any case, reabsorbed in next quarters. Please go now to page 13 for the outlook regarding 2023. As a summary, we can consider 2023 as a year of stabilization and moderate growth after the strong double-digit increase recorded in the last two years.
We have incurred three non-company-specific headwinds. The first one is a currency devaluation, mainly linked to ruble, that is expected to impact our top line in the region of EUR 50 million. Unusual weather condition with a heavily raining May and a really hot September that really impacted our direct sales in the region of EUR 50 million. And this bad, bad weather condition also frozen reorders from wholesale and franchising, both in spring, summer, and fall, winter, driving too weak second and fourth quarter for a total of EUR 15 million impact. So we assume for the full year, revenues growing low- to mid-single-digit at constant exchange rates, substantially flat at current exchange rates.
Regarding gross margin, it is believed that this can further uplift in respect to the previous full year guidance, and thus reach an improvement by about 250-300 basis point over the full year, thanks to our policies aimed at containing discounts and to the efficiency of the supply chain, cost structure. Let me end this first part of the call, announcing that Geox is strengthening its management team with the addition of four senior managers. First one, Andrea Maldi, who as of December 4 is appointed as Chief Financial Officer. He has recently held the role of CFO at Fiera Milano S.p.A., and previously he served as a group CFO at Borsa Italiana S.p.A., where he was also an executive member of the Board of Directors.
From 2009 - 2014, he was a CFO for General Electric Corporate Energy Business in Italy, also serving as a legal representative for the Italian branch. So we are really improve, we will really improve and strengthen our industrial relation activity. Then we appointed Carsten Richter as Managing Director, the Managing Director for German-speaking countries . He has an extensive experience from the footwear and fashion industry. Over the past 15 years, he has been responsible for business in the western region and Europe, and headed the footwear division for the PVH brand, Tommy Hilfiger, Tommy Jeans, Calvin Klein, Calvin Klein Jeans, and before joining PVH Corp, he worked as a sales manager footwear for Esprit and another brand, Kangaroos.
Then Paolo Gajo is, we announced his appointment as Country Manager for the Italian market in November, this week. Since 2016, he has been in charge of Timberland wholesale and distributor business in EMEA, Middle East and Africa, after having held the role of Country Sales Director, Italy and Greece since 2012. Previously, he held the position of increasing responsibility for other brand of VF Corporation group. You may remember that, late last year, in December, we also hired Fabio Terrin, who previously was the General Manager of VF Corporation brands in Asia Pacific, based in Hong Kong. We believe that now the team, the management team is ready to start and to foster the commercial and geographical expansion of our project and of the brand.
We are now ready to open the Q&A section and take your questions.
Thank you. This is the Chorus Call Conference operator. We will now begin the question- and- answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. To remove yourself from the question queue, please press star and two . We kindly ask to use handsets when asking questions. Anyone who has a question may press star and one at this time. The first question is from Oriana Cardani, with Intesa Sanpaolo. Please go ahead.
Yes, good afternoon. Thank you for taking my questions. The first one concerns the distribution network. Do you consider the rationalization of your retail completed, or could further actions be taken next year in terms of net closure? And as for your wholesale channel, are you satisfied with your distributors, or would a more selective policy be taken in the future? And my second question concerns the spring/summer collection, 2024 collection. Can you tell us how the order intake was for this collection? Thank you.
As far as the optimization of the network, I can say that also in 2023, it is completed. Also in 2023, we started to do selective openings. We have opened Munich, a couple of stores in London, and we are also fostering the openings of our franchisees, especially in Middle East and in Asia Pacific. So, our plan we have done a sort of big reorganization of the sales force, because in January, we engaged a new country manager in Canada, now a new country manager for and then a new country manager for Asia Pacific, now a new country manager in Germany, Austria, and Switzerland, and the new country manager for Italy. Why?
Because it's necessary, for sure, to start also a selective approach to distribution, but we would like to create, I would say, an environment. So why we opened Munich? It's part of our city attack strategy, a new flagship, but also a new wholesale strategy that allowed us to open real important premium location with the Tretter Group , and consequently, we are back in Munich. So the new openings of selective new stores will be really focused on a larger strategy regarding the territory where we will open. So I think I have also answered the question regarding selective distribution. I would say we hired people with a really extensive experience in shoe and ready-to-wear brands, premium brands.
So, Mr. Richter and also Paolo Gajo have been able to take full responsibility over Timberland and Tommy projects in Europe that drove to really important growth. And I assume that they will be able to exploit also the potential of Geox driving their countries to additional growth in comparison with what we are delivering today. And this will go through a better approach to the distribution. Spring/summer 2024, the campaign is quite difficult, I would say, because we are meeting customers that were a little bit suffering for both in spring/summer and in fall/winter.
However, we are not satisfied because, our target was, were a little bit higher, but, we will devote all our efforts to deliver on the backlog we have been able to collect, and then to foster more in-season management than what we experienced, this year. So time to work, but, we are confident, that we'll be able to deliver results.
Okay. Thank you very much.
The next question is from Francesco Brilli, with Intermonte. Please go ahead.
Good evening, and thanks for taking my questions. I've a few questions from my side, and the first one, it is more general on market conditions, weather condition, headwinds in general. Is there any action that could be taken or you have thought to, in order to deal with the increasingly common, unstable, and unpredictable weather condition, which continue to affect sales growth and pace in terms of collections or something that just if there's some project in order to tackle this issue? And then more and more on the numbers, the second one is on working capital on sales, if you can provide an indication for the end of the year.
And also on the gross margin indication of expansion without the, I mean, with less contribution from volumes, the gross margin expansion is, if you can provide some color on the building blocks on this expansion compared to last year? And then lastly, on the addition to the team you just unveiled, is something that was already planned, or you just felt the need to, I mean, to add some specific skills to the company? Thank you.
Grazie. So the first one, action to be taken, for sure, marketing, because we have seen that notwithstanding, all the headwinds, today, women, woman product, are driving the growth, and this is, in my opinion, really linked, to the good project we have been able to deliver that, the, gave value to the investment in style and, and on the progress that we did. It is clear that, in the last, 1.5 months, people that are entering, the stores and are joining our benefit, program with the registration, on average have, 10 years lower average age in comparison with the bulk of our customers. So marketing is for sure of utmost importance.
The other big trend in our industry is the fact that see now, buy now, wear now is absolutely a must, and consequently it is clear. Seasons are changing, and consequently, we must assume that also next year, maybe spring will be a little bit cold and fall will be a little bit hotter than what we were used to experience, and consequently, it's necessary to work on bestseller to maintain a different approach to supply chain in order to inject flexibility and to focus on carry over that proved to be really bestseller. But this is part of the changing environment of retail industries, and I think we are equipped to successfully manage this kind of changes. Working capital.
As you have seen, there is no issue regarding inventories, exactly the same amount as September last year. There is no issue regarding receivable, exactly, or better, just EUR 5 million more than last year, notwithstanding the fact that the turnover in a third party is really higher than this amount. It means that our customers, clients' portfolio is really healthy, and in addition, as you may remember, is insured. So I'm really satisfied with our customers', portfolio. So why there is this unusual, let's say, increase? It is just due to suppliers. Last year, we experienced really late receiving that shift the payments in the region, in the region of EUR 30 million from 2022 to the first quarter, 2023. This year, we have been able to recover any problem with the supply chain.
Stefano Orsi from Armani joined the group in 2021. He's starting really to deliver really important in our efficiency. So not only we have reduced it to zero air freight , but also we have been able to receive, from suppliers, products in order to be able to match completely the deadline requested by our customers. But this has a consequence. We have increased the payments of, new products within this year. So, this increase is totally due to goods that we have already paid, and in the next two quarter, we will sold and cash the money for this product, and consequently, next year will be really easy. We assume to pay in the region of EUR 50 million lower payments to supplier than this year, because now the situation, the trend, have completely normalized. Gross margin.
I'm really pleased and satisfied we are obtaining this kind of results in terms of, like for like, really decreasing, discounts. Traffic is not so satisfactory in the stores, so it is still below 2019. However, as I have said, year to date, week 44, we are 4.3% up in terms of like-for-like in comparison with 2019, and 3% up in comparison with last year. Gross margin is, sorry, reduction in discount is really important, and this is the first pillar of this gross margin expansion in percentage, and the other derives from supply chain efficiencies.
We are, let's say, putting the most of our focus and attention and reaction to be able to compensate with the higher gross margin in percentage, what is not coming from the weaker-than-expected sales. So we are not giving up the possibility to deliver a 15-20 EBIT at EUR 20 million EBIT at year-end. I'm a little bit, let's say prudent, because the situation is really volatile, but I think we can absolutely improve the percentage regarding profitability. And then in the next business plan, once we'll be able to deliver additional growth, I think that the profitability can materially improve also volume-wise. The team, let's say that these are not a new position.
We decided to change the management we had in these regions, trying to involve and to hire senior people with really strong experience in our industry, I mean, shoes and ready-to-wear, in international premium brands. Because we need to play a different championship, and in order to win in a different league, you need different players. I think now the team is fine. We don't need additional players. We have just to focus on delivering results.
Thank you very much, Livio. Just if I may, a quick follow-up on 2024, so next year, I mean, if you will be able to deliver this gross margin expansion, should we consider the level of, I mean, the level of cost percentage on sales to be, I mean, to be the same next year? Of course, with potentially higher operating leverage from volumes.
Yes, we are finalizing the business plan country by country, so we are a little bit ahead in improving the gross margin. The new business plan through 2024-2026 is assumed. In the new business plan, we are assuming that maybe we can also deliver additional improvement, but it's this is our target. It's too early to quantify this kind of additional improvement. But let's take this gross margin for achieved, and then we must work in additional improvements.
Thank you very much.
As a reminder, if you wish to register for a question, please press star and one on your telephone. The next question is from Andrea Bonfà , Banca Akros. Please go ahead.
Hi, Livio, good evening. Very quickly, most of my questions have already been answered. I would like just to have your, let's say, inputs or qualitative comment on the initiative with Penélope Cruz and her role as a global ambassador for Geox. As far as today, are you happy with this? Can you comment on it? Can you help us to understand if this kind of initiative are positive for a brand like yours? Thank you.
Yes, we are really satisfied. After a tough September with the negative like-for-like, let's say, the team also in the stores were really eager to see new people, the increase in footfall and the increase in sales. And I have to say that the performances that we have been able to see in starting from week 41 have been really impressive. So given this, just to give you more numbers, the first week of October was still negative, mid-single digit, and then +7%, +33%, +28%, and November is still growing. And e-commerce have been really impressive. The traffic in our website is really increasing, and starting from week 41, e-com was +40, +46, +61 and +56.
So for sure, I'm not assuming this kind of performances for all the rest of the weeks, because unfortunately, the TV campaigns ended, and now it's time to sell also other product. But last month, 4 weeks in a row, have been really exciting for the brand and for women's products . So yes, I think we have found a proper way to make customer understanding all the investment in product, in style, in communication, in tone of voice that we did. We are just moving from a conversation based on how, let's say, clever we are in doing production or in doing the technology, to a different tone of voice, to a different language on how Geox can improve people's well-being on the move.
This is a completely different story. You have seen Spherica advertising, Amphibiox advertising, and now Penélope. We are really doing a rebrand towards a lifestyle brand, because this means that not only footwear, but also ready-to-wear, and also bags and leather goods, have room in our home to be, let's say, relevant for the final customer. In my opinion, the strategy is absolutely right. The project, as you have seen, is able to, let's say, take from the market a really senior management that comes from really important groups, and because they like the project. For sure, 2023 has been really tough, many headwinds. We must keep the direction and be focused on next business plan.
Thank you very much.
The next question is from Federico Belluati with Kepler Cheuvreux. Please go ahead.
Good evening, and thank you for taking my question. My question is regarding operating expenses. Are you envisaging some savings due to the lower top line or no?
Let's say that, regarding budget, absolutely yes. Regarding last year, we assume to be more or less at the same level of operating expenses. This means that we have been able to find some savings that will be able to compensate, unfortunately, the increase due to the inflation rate, especially on rents, that have an index, that are indexed to inflation. So the fact that we will be able to maintain more or less the same level of operating expenses means that we are being able to find additional savings. But, now we need top line growth in order to deliver strong operating leverage. There is no additional material room for cost savings.
Okay. Thank you.
Once again, if you wish to ask a question, please press star and one on your telephone. For any further questions, please press star and one on your telephone. Gentlemen, there are no more questions registered at this time. I turn the conference back to you for the closing remarks.
Bene, thank you very much for your time. We will present top line late January, early February. We will present the corporate calendar soon, and then full year in March, in the first week of March or also. Thank you very much. Keep in touch. Feel free to ask any question, doubt you may have to me or to Luca, and starting from December the fourth, also to the new CFO that we will introduce to you. Thank you very much. Bye.
Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.