Natuzzi (NTZ) Q4 2024 earnings summary

Executive summary

• Full year 2024 revenue reached €318.8 million, down 3% year-over-year amid continued market volatility and softness across geographies.

• Branded sales accounted for €289 million, representing 93% of total sales, up from 80% in 2019, reflecting a strategic shift from manufacturing to brand retailing.

• Direct operated store revenue grew 4% versus 2023 and 18% versus 2019, driven mainly by U.S. expansion and selective store closures to optimize the network.

• Transformation efforts included retail network optimization, workforce reduction, and production relocation, notably closing the Shanghai plant and shifting production to Europe.

• Net loss for 2024 was (€15.4M), a slight improvement from (€16.2M) in 2023.

Financial highlights

• Gross margin improved to 36.3% in 2024, up from 34.3% in 2023 and 29.7% in 2019.

• Q4 2024 gross margin reached 38.1%, up 8 percentage points from Q4 2023.

• Operating loss narrowed to (€6.3M) from (€9.5M) in 2023; excluding €5.3M in one-off severance, adjusted operating loss was (€1.0M).

• Net finance costs for 2024 were (€8.8M), slightly higher than (€8.5M) in 2023, mainly due to increased lease liabilities.

• Cash at year-end was €20.3M, down from €33.6M, with net financial position before lease liabilities at (€21.7M).

Outlook and guidance

• Focus remains on organic growth and improving profitability through increased sales per store and enhanced operational efficiency.

• No major retail expansion planned for 2025; priority is to nurture recently opened stores and drive revenue growth within the existing network.

• Break-even revenue threshold now estimated at around €340 million, lower than previous years due to improved margins and cost structure.

• Management remains confident in the long-term strategic vision, focusing on product innovation, digital transformation, and operational excellence.

• The company expects to complete the sale of land in Romania in 2025 and continues to divest non-strategic assets.