UK plan becomes clearer for Natuzzi but currency fluctuations continue to harm profitability

24th November | upholstery | Italian sofa company Natuzzi has shed further light on its UK plans and says it expects to be profitable again worldwide ‘within the next few quarters.’

The firm has been without a UK md since Nick Moore’s departure almost six months ago, but has now appointed former Nicoletti executive Cosimo Cavallo to spearhead its UK operation. Cavallo, based in Italy, has become senior vice-president with responsibility for the UK market along with the Southern and Eastern European regions. It is not yet known if he will appoint a UK md to work alongside Matt Gayleard, UK brand director.

Two years ago, the firm pledged to open up to 20 Natuzzi stores in the London area alone, but has since managed just one, on Finchley Road.

Other stores have opened in Manchester and Cardiff, but it is expected that Natuzzi will channel all its energies into galleries, which are continuing to open across the UK.

In the last quarter, two more concessions opened, bringing the total number to 17 in the UK. Many of these are within high profile department stores such as Selfridges and House of Fraser.

Globally the company is struggling to combat the effects of unfavourable exchange rates as it bids to turn a profit again. Sales to the end of the third quarter of 2008 reached EUR 483.9m – a 5.8% improvement. However, unit sales rose by 7.5% during the same period and the company says fluctuations in currency have cost it about EUR 20m so far this year.

It expects to make a full year operating loss of between EUR 35-40m – which will be an improvement on the EUR 49.1m it lost in 2007.