Lanvin Group's FY2024 Results: Navigating Turbulence in the Luxury Landscape

The Lanvin Group (NYSE: LANV) has published its fiscal year 2024 (FY2024) results, revealing a challenging year marked by significant revenue declines and net losses. While the Group frames this period as a "transitional year" of strategic realignment, investors must weigh its operational struggles against its long-term growth ambitions. Below, we dissect the financials, performance drivers, and risks to assess whether Lanvin’s shares present an opportunity or a cautionary tale.

Executive Summary

• Revenue: €328.16 million (-23% YoY).
• Net Loss: €189.3 million (-29% expansion from FY2023’s €146.3 million loss).
• Key Drivers: Macroeconomic headwinds, brand-specific operational issues, and strategic restructuring.
• 2025 Outlook: Focus on cost discipline, creative leadership transitions, and geographic optimization.

Key Financials: A Year of Declines

The Group’s FY2024 results reflect a sharp contraction across nearly all metrics:

1. Revenue Performance:
2. Total revenue fell 23% to €328 million, with declines across all major brands except Caruso (down only 7%).
3. Wolford (down 31%) and Sergio Rossi (down 30%) were hardest hit, while Lanvin (down 26%) struggled with creative transitions.

4. Geographic Weakness: EMEA (-28%) and Greater China (-37%) markets declined sharply, while North America (-13%) and Japan showed relative resilience.

5. Profitability Metrics:

6. Gross Profit Margin: Held steady at 56%, supported by a higher DTC sales mix (61% of revenue).
7. Contribution Profit: Turned negative (-€26 million) due to fixed costs outpacing revenue declines.

8. Adjusted EBITDA Loss: Widened to €92.3 million (-28% of revenue), up from €64.2 million in FY2023.

9. Net Loss Drivers:

10. Impairment charges of €31.2 million (primarily impacting Wolford and Sergio Rossi).
11. Rising financing costs (+9% YoY to €29.8 million).
12. Persistent brand underperformance, particularly in Europe and Asia.

Performance Drivers: Challenges and Strategic Shifts

1. Macroeconomic and Market Pressures

The luxury sector faced a slowdown in key regions, with EMEA and Greater China markets contracting due to cautious consumer spending and logistical disruptions. Wolford’s decline was exacerbated by a transition to a new logistics provider, while Sergio Rossi grappled with fixed costs on reduced production volumes.

2. Brand-Specific Issues

• Creative Transitions: Lanvin’s new Artistic Director, Peter Copping, prioritized long-term creative renewal over short-term sales, delaying revenue recovery.
• Operational Inefficiencies: Wolford’s organizational restructuring and Sergio Rossi’s leadership changes added to near-term costs.

3. Strategic Realignments

• Leadership Changes: Andy Lew (Executive President), Regis Rimbert (Wolford CEO), and Paul Andrew (Sergio Rossi Creative Director) signal a push for operational and creative discipline.
• Retail Optimization: Store count reduced from 279 to 225, focusing on high-potential markets like the Middle East and Asia.
• European Expansion: A new headquarters in Europe aims to improve local market penetration.

Data Insight: Lanvin’s Stock Performance

The stock has underperformed broader markets, reflecting investor skepticism about its turnaround potential. While peers like LVMH and Kering have stabilized post-pandemic, Lanvin’s share price has remained volatile, down ~40% year-to-date as of April 2025.

Risks and Uncertainties

1. Execution Risks: Success hinges on new leadership’s ability to revive brands like Wolford and Sergio Rossi.
2. Geographic Dependency: Greater China and EMEA account for ~60% of revenue; recovery in these markets is critical.
3. Margin Pressures: Even with cost-cutting, margins remain fragile unless revenue growth resumes.

Conclusion: A Gamble on Turnaround Potential

Lanvin Group’s FY2024 results underscore the risks of overleveraging in a volatile luxury market. With a net loss of €189 million and declining revenue, the Group’s survival depends on swift execution of its restructuring plans. However, there are glimmers of hope:

• Creative Leadership: Peter Copping’s Lanvin collection and Paul Andrew’s Sergio Rossi relaunch have received critical acclaim, signaling potential top-line recovery.
• Cost Discipline: G&A expenses fell 15% YoY, and DTC dominance (61% of sales) offers a high-margin foundation.
• Strategic Focus: Geographic optimization and brand consolidation could amplify returns in core markets.

Investors must weigh these positives against the Group’s financial fragility. While FY2024’s losses are steep, Lanvin’s 2025 targets—margin improvement and cashflow breakeven—are achievable if macro conditions stabilize and creative strategies gain traction.

Final Verdict: Lanvin Group is a high-risk, high-reward play. Its shares may appeal to investors with a long-term horizon and tolerance for volatility, but near-term uncertainty remains elevated. Monitor FY2025 half-year results (due in August 2025) for signs of stabilization.

This analysis synthesizes Lanvin’s financial struggles with its strategic pivots, offering a balanced view for investors navigating its turbulent journey.