'Geox will have to grow in the future' - Chairman Mario Moretti

15 May '09

4 min read

Operating expenses and Operating income (EBIT)
Selling and distribution expense as a percentage of sales was 4.6%, in line with the same period of the previous year (4.5%).

General and administrative expense increased as a percentage of sales, mainly because of the costs involved in opening and running the directly operated stores (DOS), in particular flagship stores.

Advertising and promotion expense was equal to 2.3% of sales compared to 4.2% in the same period of the previous year. The decrease is mainly due to a substantial reduction in media prices and a different mix of advertising channels used.

Operating income (EBIT) was Euro 116.5 million (119.4 million in the same period of 2008). Operating income, as a percentage of sales, was 30.3%.

Income taxes and tax rate
Income taxes were equal to Euro 40.7 million, compared 37.6 million in the first quarter of 2008, with a tax rate of 36% (32% in the same period of 2008).

THE GROUP'S FINANCIAL PERFORMANCE
The Group shareholders' equity rose mainly thanks to the net result of the period, while net cash position was equal to Euro 22.6 million (Euro 58.2 million at the end of 2008).

Net working capital as a percentage of sales shows an increase over the equivalent period of 2008. This is mainly due to the decrease of accounts payable, caused by early receiving of Spring/Summer products compared to the previous year. The free cash flow of first quarter is negative for Euro 22.4 million, showing an improvement from Euro 51.2 million in the first quarter of 2008, partly due to the decrease in capital expenditure.

Geox S.p.A.

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