Natuzzi reports Q2 net sales EUR 78.3M, down 7.2% from last year

Reports Q2 operating profit EUR (2.7M) vs. (0.4M) last year. Pasquale Natuzzi (NTZ), Chairman and Chief Executive Officer ad interim of the Group, commented: “The operating environment remains challenging, influenced by the geopolitical instability, a weak U.S. real estate market, a strengthening euro, and still high interest rates. These factors have affected consumer confidence and slowed demand of semi-durable goods. Furthermore, trade tensions arising from U.S. trade tariffs have heightened uncertainty, with dealers and their buyers prioritizing inventory reduction over placing new orders. As a result, consolidated sales for the first half of the year fell short of our expectations, making it more difficult to absorb fixed costs and protect margins. We fully recognize that the Group is currently navigating a highly challenging environment and Company-specific factors. These circumstances have weighed on our operating performance and slowed the execution of our turnaround strategy, which have adversely affected our cash-generation capacity. In response to that, management is developing a comprehensive restructuring plan, aimed at restoring efficiency and profitability across the Group, and that marks a clear break from the past. The restructuring plan guidelines envisages: a significant reduction in fixed costs; a more flexible production capacity; the divesting of certain non-strategic Italian assets; the outsourcing of low value-added activities; and a review of the Company’s capital structure and potential capital strengthening measures. In the short term, we remain firmly committed to maintaining a rigorous focus on cash flow monitoring, exerting strict controls on discretionary spending, and ensuring disciplined management of working capital to safeguard our liquidity. Although the execution of our commercial strategy is affected by current uncertainties, its core pillars remain unchanged. Investments made in product innovation, design, marketing and customer experience are delivering encouraging results, and the Trade & Contract division represents a short-term growth opportunity.”