>>> Europe : Brokers Upgrades & Downgrades - 11th of May 2023

>>> Up
* Bakkafrost Raised to Buy at Arctic Securities; PT 800 kroner
* Diploma Raised to Buy at Jefferies; PT 3,150 pence
* L'Oreal PT Raised to 350 euros from 296 euros at Jefferies
* Sopra Steria Raised to Buy at AlphaValue/Baader; PT 252 euros

>>> Down
* Ahold Delhaize Cut to Hold at HSBC; PT 33 euros
* Bridgepoint Cut to Underweight at JPMorgan; PT 224 pence
* Demant Cut to Hold at SEB Equities; PT 325 kroner
* Gofore Raised to Buy at Inderes; PT 31 euros
* HighCo Cut to Neutral at Oddo BHF; PT 5.70 euros
* Outokumpu Cut to Hold at SEB Equities; PT 6 euros

>>> Initiation
* Demant Maintained at Buy at SEB Equities; PT 325 kroner

>>> Call
* Diploma Upgraded to Buy at Jefferies on Capacity For M&A
* Elis Delivers Strong First-Quarter Growth, Morgan Stanley Says

>>> What to look at today - 11th of May 2023

US equity futures inched higher and Chinese stocks swung between small gains and loses on Thursday as signs of slowing inflation in the world’s two largest economies spurred hopes for monetary easing. In China, inflation slowed more than expected in April while factory-gate price growth also fell short of forecasts, keeping the window open for monetary easing from the People’s Bank of China.  Mainland China shares rose while Hong Kong’s Hang Seng Index fluctuated. The broader picture for Asian equities was mixed. South Korean stocks rose, Australian shares fell and Japanese equities declined, weighed down by a stronger yen. The dollar held losses following a drop in Treasury yields Wednesday, which held into Asian trading. The policy-sensitive two-year Treasury yield closed the US session down 11 basis points after headline inflation eased to 4.9% in April. That was the first reading below 5% in two years and below consensus expectations. Core inflation remained at 5.5%.  In Hong Kong, the cost to borrow overnight reached a sixteen year high as liquidity tightened after authorities repeatedly intervened to boost the local currency. Elsewhere in the region, Adani Enterprises, billionaire Gautam Adani’s flagship, will hold a board meeting later this week to consider selling stock, the company said in a statement.  The company’s shares have halved this year in a decline driven by accusations of fraud from short seller Hindenburg Research. The group’s US-currency bonds rose Thursday amid a broad gain in investment-grade dollar notes in Asia. Meanwhile, an illiquid corner of swaps insuring Credit Suisse Group AG debt has surged back to life. They’ve had their biggest jump this week since UBS Group AG agreed to buy Credit Suisse in March, as funds including FourSixThree Capital and Diameter Capital Partners pile in, according to people familiar with the matter. Gold edged up as signs that US inflation is cooling fueled speculation that the Federal Reserve will soon pause tightening. Oil advanced for the fourth session in five as easing US inflation weakened the dollar and traders assessed interruptions to supplies.  US After Hours Busy earnings session highlighted by DIS -4.3%; APP +12.3%, U +10.4%, DV +5.8%, ALGM +5.7% higher on earnings; SONO -19.2%, CDNA -9.1% lower on earnings.

Nikkei -0.05% Hang Seng -0.47% CSI -0.09% Shanghai -0.24% Shenzen +0.19%

Eur$ 1.0977 CNH 6.9394 CNY 6.9345 JPY 134.21 GBP 1.2620 CHF 0.8905 RUB 76.22563 TRY 19.5466 WTI$ 73.13 +0.79% Gold 2,031 +0.05% BTC 27,500 -1.34% ETH 1,830 -1.57%

S&P +0.25% Nasdaq +0.20% EuroStoxx +0.28% FTSE +0.23% Dax +0.26% SMI +0.07%

Macro :
- EU Will Publish CO2 Market Surplus Indicator on May 15

Keep an eye on :
- ARL GY : Aareal Bank 1Q Operating Profit EU62M Vs. EU30M Y/y
- YOU GY : About You Sees 2024 Revenue +1% to +11%
- AAF LN : Airtel Africa FY Adjusted Revenue Matches Estimates
- AKTIA FH : Aktia Bank 1Q Adjusted EPS Beats Estimates
- ALV GY : Allianz SE to Buy Back Up to EU1.5 Billion Shares
- BAYN GY : Bayer Sees FY Forecast at Lower End of Guidance Ranges
- BC8 GY : Bechtle 1Q Ebit Misses Estimates
- BEN FP : Beneteau 1Q Revenue Beats Estimates
- BDT GY : Bertrandt Raises 2023 Total Revenue Growth View
- CO FP : Groupe Casino: No Added Info to Communicate About Teract Talks
- COLOB DC : Coloplast Narrows FY Ebit Margin Forecast
- CCAP GY : Corestate CFO Udo Giegerich to Resign From Management Board
- CSGN SW : Credit Suisse CDS Surge as Hedge Funds See Potential Trigger
- CTPNV NA ; CTP 1Q Net Rental Income EU130.7M Vs. EU107.2M Y/y
- DIC GY : DIC Asset 1Q FFO EU12.9M Vs. EU26.7M Y/y
- DNO NO : DNO 1Q Revenue Meets Estimates
- DNR IM : De Nora 1Q Adjusted Ebitda EU46.7M Vs. EU55.2M Y/y
- DTE GY : Deutsche Telekom Boosts FY Adjusted Ebitda After Leases Forecast
- FGR FP : Eiffage 1Q Sales Beats Estimates
- ELIS FP : Elis 1Q Organic Revenue Beats Estimates
- ENGI FP : Engie Earnings Jump 19% on Higher Energy Prices, Renewables
- ENGI FP : Engie Sees FY Recurring Net Income High End of EU3.4B to EU4.0B
- ETL FP : Eutelsat 3Q Revenue Meets Estimates
- GAM SW : GAM Says Rock Investment Files Objection on Offer by Liontrust
- GET FP : Getlink April Passenger Shuttle Traffic Y/y +5%
- GFT GY : GFT 1Q Pretax Profit EU15.0M Vs. EU13.4M Y/y
- GLJ GY : Grenke 1Q Net Income EU15.9M Vs. EU20.5M Y/y
- HNR1 GY : Hannover Re 1Q Net Income EU484.5M Vs. EU427.9M Y/y
- HLAG GY : Hapag-Lloyd Maintains FY Ebitda Forecast
- HEX NO : Hexagon Composites 1Q Ebitda Loss NOK29M, Est. Loss NOK43.5M
- INH GY : Indus Holding 1Q Ebit EU44.8M Vs. EU41.4M Y/y
- INS GY : Instone Real Estate 1Q Adjusted Ebit EU15.8M Vs. EU17.0M Y/y
- INTRUM SS : Intrum Buys Servicing Platform Haya Real Estate EU140 Million
- IVG IM : Iveco 1Q Consolidated Revenue Misses Estimates
- JEN GY : Jenoptik 1Q Ebitda Beats Estimates
- LI FP : Klepierre 1Q Net Rental Income EU228.5M Vs. EU221.5M Y/y
- KBX GY : Knorr-Bremse 1Q Ebit Beats Estimates
- KWS GY : KWS Saat 9M Ebit EU261.2M Vs. EU185.9M Y/y
- LIN US : Singapore Fund GIC Said in Talks for $2 Billion Stake in Messer
- MDM FP : Maisons du Monde 1Q Sales EU273.7M Vs. EU313M Y/y
- MAERSKB DC : Maersk Unit Has Four Tug Boats Seized in Russia, Borsen Says
- MLP GY : MLP 1Q Ebit EU32.4M Vs. EU34.6M Y/y
- MRK GY : Merck KGaA Sees FY Adjusted Ebitda EU6.1B to EU6.7B, Est. EU6.5B
- META US : Facebook Fails in Bid to Get Cambridge Analytica Lawsuit Tossed
- META US : EU Vows to Act If Revamped US Data-Transfer Pact Poses Problems
- MONT BB : Montea FY Adjusted EPS Forecast Beats Estimates
- NVG PL : Navigator Co 1Q Net Income EU71.7M Vs. EU50.6M Y/y
- NEXI IM : Nexi 1Q Operating Revenue Meets Estimates
- OLG FP : Arctos Considers Taking Minority Stake in Paris Saint-Germain
- PFV GY : Pfeiffer Vacuum 1Q Ebit EU32.2M Vs. EU31.3M Y/y
- PHARM NA : Pharming 1Q Revenue $42.5M Vs. $46.6M Y/y
- PLUG US : Hydrogen CEO Warns IRA Cuts Would Shift Clean-Energy Jobs to EU
- PRS NO : Prosafe Offering of 2.72m Shares Prices at NOK117/Share
- PURP LN : Strike in Talks to Buy Business and Assets of Purplebricks
- RECSI NO : REC Silicon 1Q Ebitda Loss $23M Vs. Loss $23.6M Q/Q
- S30 FP : Solutions 30 1Q Revenue EU255.3M Vs. EU222.7M Y/y
- SALM NO : Salmar 1Q Operating Ebit Beats Estimates
- SBMO NA : SBM Offshore 1Q Adjusted Revenue $742M Vs. $970M Y/y
- SGSN SW : SGS Buys Stake in Nutrasource Pharmaceutical and Nutraceutical
- SRS IM : Italy’s Saras Will Spend EU750m to Meet Renewables Goal
- SAX GY : Stroeer 1Q Adjusted Ebitda Beats Estimates
- WAF GY : Siltronic 1Q Sales Meets Estimates
- SIX2 GY : Sixt 1Q Pretax Profit Misses Estimates
- S92 GY : SMA Solar 1Q Ebitda EU60M Vs. EU14.8M Y/y
- SMHN GY : Suess MicroTec 1Q Ebit EU2.9M Vs. EU2.1M Y/y
- SUSE GY : SUSE Prelim 2Q Adjusted Revenue Misses Estimates
- SLHN SW : Swiss Life 1Q Fee and Commission Income CHF595M
- TEG GY : TAG Immobilien 1Q FFO per Share Beats Estimates
- TAP PL : TAP 1Q Net Loss Narrows to EU57.4m Vs. Loss EU121.6m Y/y
- TEF SM : Telefonica 1Q Oibda Beats Estimates
- TEMN SW : Expands Relationship with AWS to Offer Core Banking as SaaS
- TGS NO : TGS 1Q Net Revenue $173M Vs. $132M Y/y
- TKA GY : Thyssenkrupp 2Q Adjusted Ebit Beats Estimates
- TKA GY : Thyssenkrupp Raises Cash Flow Guidance Despite Lower Earnings
- TIT IM : Telecom Italia Posts Earnings On Track with CEO’s Recovery Plan
- TOD IM : Tod's 1Q Sales Beats Estimates
- VASTN NA : Vastned 1Q Occupancy 97.9% Vs. 98.6% Q/Q
- VEI NO : Veidekke 1Q Pretax Loss NOK147M, Est. Loss NOK8.06M
- VOD LN : Vodafone Says Board Members Gooding, Davis, Furse to Retire
- WIE AV : Wienerberger 1Q Revenue Beats Estimates
- ZEQL DC : Zealand Pharma 1Q Net Loss DKK193.6M Vs. Loss DKK222.8M Y/y

>>> US After Hours Summary: Busy earnings session highlighted by DIS -4.3%; APP

After Hours Summary: Busy earnings session highlighted by DIS -4.3%; APP +12.3%, U +10.4%, DV +5.8%, ALGM +5.7% higher on earnings; SONO -19.2%, CDNA -9.1% lower on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: PRPL +22%, APP +12.3%, U +10.4%, MAXN +9.6%, DXPE +8.4%, FLNC +7.4%, MGNI +6.5%, DV +5.8%, ALGM +5.7%, SMRT +5.6%, NXT +5.3%, STE +4.1%, BYND +3.9% (also files mixed shelf securities offering), TTD +3.6% (also CFO to step down, names new CFO), ALRM +2.9%, ACVA +2.6%, PAAS +2.6%, RBA +2.3%, ORCC +2.3%, JAZZ +2.1%, MATV +2.1%, HOOD +2%, SOVO +2%, TTEK +2%, STKL +1.5%, CPRX +1.3%, LAW +1.2%, RPAY +1%, RICK +0.8%, OR +0.8% (also increases dividend), OSUR +0.7%, CDE +0.4%, NDLS +0.4%, CR +0.3%, CPA +0.2%, PYCR +0.1%

Companies trading higher in after hours in reaction to news: HMPT +16.8% (COOP to acquire HMPT), NEWT +2.7% (to delay 10-Q filing), ADEA +2.1% (TVStorm renews license for Adeia's media IP portfolio), BNTX +1.4% (MTNB says study of mRNA delivery did not demonstrate preclinical activity; collaboration deal has concluded), JWN +0.4% (names new CFO)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: SONO -19.2%, CDNA -9.1% (also files mixed shelf securities offering), DM -8.5% (also files for 444,793 share offering by selling shareholders), BLFS -8.1% (also exploring strategic alternatives for CBS and Stirling), GDEN -6%, VUZI -5.7%, DIS -4.3%, PAR -2.2%, HPK -2.1%, MFC -1.9%, RIOT -1.9%, CRSR -1.7%, DOX -1.4%, NTR -1.3%, COOK -1.2%, MARA -0.9%, FLEX -0.1%

Companies trading lower in after hours in reaction to news: TSLX -4% (launches 4.5 mln share offering), HLMN -3.2% (stock offering by selling shareholder), REXR -2.5% (13.5 mln share offering), BELFB -1.7% (files $250 mln mixed shelf securities offering), IRT -1.5% (increases dividend), TTCF -1.4% (to delay 10-Q filing), CDZI -1.3% (stock offering by selling shareholders), SST -1% (to delay 10-Q filing), EQNR -0.2% (awards two major contracts for the BM-C-33 project in Brazil), ACI -0.1% (KR is committed to legal fight if deal for ACI is blocked, according to Bloomberg)

>>> US Notable earnings/guidance movers: DIS -2.9%; APP +10.9%, BYND +9.5%, U +8

Notable earnings/guidance movers: DIS -2.9%; APP +10.9%, BYND +9.5%, U +8.8%, HOOD +5.4%, ALGM +4.2% on upside; SONO -21.1%, CDNA -15%, DM -7.4%, GDEN -5.2% on downside

  • Earnings/guidance gainers: PRPL +24.4%, APP +10.9%, BYND +9.5%, U +8.8%, MAXN +6.5%, MGNI +6.2%, HOOD +5.4%, DV +4.9%, ALGM +4.2%, NXT +3.3%, ACVA +2.8%, ORCC +2.4%, SOVO +2%, COOK +1.8%, FLEX +1.7%, TTD +1.7%, LAW +1.4%, CR +1.2%
  • Earnings/guidance losers: SONO -21.1%, CDNA -15%, DM -7.4%, GDEN -5.2%, BLFS -5.1%, DIS -2.9%, RPAY -1.9%, CDE -1.3%

>>> US Close Dow -0.09% S&P +0.45% Nasdaq +1.04% Russell +0.56%

Closing Stock Market Summary

Today's trade was mostly mixed. The Dow Jones Industrial Average spent most of the session in negative territory while the Nasdaq and S&P 500 outperformed, supported by gains in the mega cap space. 

Price action was somewhat tepid today until a rebound effort took root in the afternoon when the S&P 500 briefly slipped below the 4,100 level. Ultimately, the Nasdaq and S&P 500 closed comfortably above unchanged levels. Mega cap stocks offered integral support to the broader market, leaving the Vanguard Mega Cap Growth ETF (MGK) up 1.1% while the Invesco S&P 500 Equal Weight ETF (RSP) closed flat and the market-cap weighted S&P 500 rose 0.5%. 

Alphabet (GOOG 112.28, +4.34, +4.0%) was a big driver of the mega cap outperformance, as it rallied amidst the company's presentation at its Developers Conference, which included updates on its AI initiatives. 

Initially, market participants reacted favorably to the April Consumer Price Index (CPI), but a closer look fostered uncertainty about the Fed's policy path. Total CPI was up 4.9% year-over-year in April, down from 5.0% in March, which marks the sub-5.0% reading in two-years. Core-CPI, which excludes food and energy, was up 5.5% year-over-year in April, down from 5.6% in March.

Presumably, the April CPI report will sway the Fed to entertain holding the target range for the fed funds rate steady at 5.00-5.25% at its June meeting, but importantly, a 5-handle on core-CPI isn't going to sway the Fed to think it needs to cut rates anytime soon.

That understanding, along with ongoing concerns about the debt ceiling and a possible hard landing for the economy, kept the market in check through most of the session. 

In the early going, continued softness in the regional bank space had been another limiting factor. Some of the pressure there dissipated by the close with some regional bank shares coming along for the rally. The SPDR S&P Regional Banking ETF (KRE) had been down as much as 2.2%, but closed with a 1.0% loss. Western Alliance (WAL 27.48, +0.53, +2.0%) squeezed out a slim gain while PacWest (PACW 6.08, -0.03, -0.5%), which saw a loss of 5.4% at its low, closed with a modest 0.5% decline. 

Still, the S&P 500 financials sector (-0.6%) closed near the bottom of the pack, along with industrials (-0.3%). The energy sector (-1.2%) saw the biggest decline as oil prices fell due to growth concerns. WTI crude oil futures fell 1.6% to $72.56/bbl.

The communication services sector (+1.7%) was the best performer by a decent margin thanks to the gain in Alphabet. The information technology (+1.2%) and real estate (+1.0%) sectors were also top performers.

Treasuries settled with gains across the curve. The 2-yr note yield fell 10 basis points to 3.90% and the 10-yr note yield fell eight basis points to 3.44%.

  • Nasdaq Composite: +17.6% YTD
  • S&P 500: +7.8% YTD
  • Dow Jones Industrial Average: +1.2% YTD
  • S&P Midcap 400: +0.8% YTD
  • Russell 2000: -0.1% YTD

Reviewing today's economic data:

  • The weekly MBA Mortgage Applications Index rose 6.3% with refinancing applications jumping 10% and purchase applications rising 5%. 
  • Total CPI was up 0.4% month-over-month ( consensus +0.4%) and up 4.9% year-over-year, versus up 5.0% in March. Core-CPI, which excludes food and energy, was also up 0.4% month-over-month (consensus +0.3%) and up 5.5% year-over-year, versus up 5.6% in March.
  • The index for shelter (+0.4%) was the largest contributor to the increase in total CPI and core-CPI; however, the 0.4% increase was the smallest increase for the shelter index since January 2022.
    • The key takeaway from the report as far as the market is concerned is that the moderation in inflation, coupled with the moderation in the shelter index, should at least spur the Fed to entertain keeping its policy rate on hold when it meets again in June.
  • The weekly EIA crude oil inventories data showed a build of 2.95 million barrels after last week's draw of 1.28 million barrels.
  • The April Treasury Budget showed a surplus of $176.2 billion compared to a surplus of $308.2 billion in the same period a year ago. The Treasury Budget data is not seasonally adjusted so the April 2023 figure cannot be compared to the March 2023 figure. The surplus in April was the result of receipts ($638.5 billion) exceeding outlays ($462.3 billion).
    • The key takeaway from the report is that individual income and corporate tax receipts combined were $461.5 billion, which was 32.3% less than April 2022.

Looking ahead to Thursday, market participants will receive the following economic data:

  • 8:30 ET: April PPI ( consensus 0.3%; prior -0.5%), Core PPI ( consensus 0.3%; prior -0.1%), weekly Initial Claims ( consensus 247,000; prior 242,000), and Continuing Claims (prior 1.805 mln)
  • 10:30 ET: Weekly natural gas inventories (prior +54 bcf)

Vice : Judge Affirms Jack Dorsey’s Right To Make Objectively ‘Terrible’ Business

Judge Affirms Jack Dorsey’s Right To Make Objectively ‘Terrible’ Business Decisions
The mobile payment company Block was within its rights to buy Jay-Z’s music streaming service Tidal, even if the deal sucked, a Delaware judge ruled Tuesday.

In a victory for rich and powerful friends sitting on beaches everywhere, a Delaware judge has dismissed a lawsuit against Jack Dorsey and his mobile payment company Block, saying the board was within its rights to buy Jay-Z’s music streaming service Tidal, even if the decision was objectively “terrible” and a result of Dorsey summering with the Carters in the Hamptons.


Block had faced a shareholder suit from a pension fund as a result of the $300 million deal to acquire a majority stake in Tidal, which came as the streaming company was “failing financially” and facing a criminal investigation in Norway related to inflated streaming numbers.

At particular issue was Dorsey’s burgeoning friendship with Jay-Z, and whether Dorsey and Block's board was within its right to make a major acquisition in part because of that friendship even if the business reasoning did not make sense. The judge notes that the idea to buy Tidal had come to Dorsey while he was “summering” with Jay-Z’s family in the Hamptons. Dorsey had, in fact, suggested Block, then called Square, acquire Tidal during a videoconference meeting he took from the Hamptons in 2020. A

“It seemed, by all accounts, a terrible business decision,” the judge stated in his ruling Tuesday.

The plaintiffs said that a "transaction committee" at Block met to discuss the Tidal acquisition for only 35 minutes in September 2020. At a follow-up meeting the next month, the transaction committee discussed Tidal's low subscriber numbers, the fact it "had recorded multimillion-dollar losses in each of its previous ten quarters," Spotify's dominance in the streaming space, and "potential risks,” like the Norwegian criminal probe and U.S. federal lawsuit brought against Tidal by artists who said they were owed royalties.


During the process, the transaction committee also discovered that Dorsey was “the sole Block management member in support of the acquisition.” But the deal moved forward anyway in March 2021.

The court decision details Dorsey and Carter’s friendship in hilarious detail, noting they “share interests in cryptocurrency and philanthropy” and were “spotted vacationing together in Hawaii” just days after Block formally started the process of acquiring Tidal. Dorsey had additionally donated $10 million to Carter’s nonprofit in May 2020, and the pair created and funded an endowment the next year dedicated to “ bitcoin development in India and Africa.”

The judge dryly stated Tuesday that a “commonsense” interpretation of the situation was that Dorsey effectively used Block’s “corporate coffers” to further “bolster his relationship” with one of the greatest rappers alive. But, he added, the law is the law, and under Delaware law, “a board comprised of a majority of disinterested and independent directors is free to make a terrible business decision without any meaningful threat of liability, so long as the directors approve the action in good faith.”

Yes, the judge said, Dorsey might have been “incapable of impartially” considering the acquisition due to his burgeoning relationship with the writer of “Big Pimpin,’” it was harder to say that most of Block’s board had acted in bad faith.

“Plaintiff has alleged sufficient facts to make a reasonable person question the business wisdom of the Tidal acquisition, but plaintiff has failed to plead that the committee defendants acted in bad faith and thus faced a substantial likelihood of liability for that decision,” the judge wrote.

The suit has allowed insight into how at least some $300 million business deals happen—that is, as a result of two friends enjoying a nice talk in the Hamptons.

WWD : Tod’s, Roger Vivier, Leather Goods Shine in Q1

Tod’s, Roger Vivier, Leather Goods Shine in Q1
The Tod's Group reported a 23.2 percent gain in revenues, also lifted by all its main markets, and China in particular.

MILAN — All product categories, markets and channels boosted the Tod’s Group’s performance in the first quarter of the year.

In the three months ended March 31, revenues rose 23.2 percent to 270.5 million euros, compared with 219.6 million euros in the same period the year before.

Diego Della Valle, chairman and chief executive officer of the group, touted “the excellent performance” of the company, highlighting the “outstanding” results at Tod’s and Roger Vivier, “with excellent feedback in all product categories, confirming our customers’ ever-increasing appreciation for the very high quality of our products, their craftsmanship and their Italian lifestyle.”

Della Valle underscored the growth in all geographic areas and in particular the contribution of the Chinese market, following the lifting of COVID-19 restrictions.

“We remain focused on our main goal to increase the equity value of both our group and our individual brands, through our continuous commitment to strengthen their positioning with the needed investments in marketing, communication and managerial skills, albeit in a logic of cost control and improvement of operational and managerial efficiency,” Della Valle said. “We continue to invest in our supply chain, to ensure the highest possible quality for our products. We will continue to grow selectively our distribution network, while remaining focused on both improving organic growth and developing the omnichannel distribution. The macroeconomic environment remains unpredictable, but considering the good sales trends we experienced in April and the excellent orders backlog for the winter collections, I’m confident about the group’s future results.”

Sales of the Tod’s brand climbed 24.4 percent to 130.2 million euros and Roger Vivier was up 30.9 percent to 68.6 million euros. The contribution of China, where both brands are present with their own network of points of sale in the most important luxury malls, was significant.

In the period, Hogan was up 10.1 percent to 56.8 million euros and sales of Fay jumped 30.6 percent to 14.2 million euros. The latter’s performance was helped by the timing in wholesale deliveries, said chief financial officer Emilio Macellari during a call with analysts, as the brand is predominantly a wholesale business.

Sales of shoes rose 19.3 percent to 206.8 million euros.

Revenues of leather goods and accessories climbed 36.5 percent to 43.2 million euros.

“Leather goods outperformed everywhere,” Macellari said. The category’s performance was “particularly good and encouraging. We have been working for years toward this. The results are homogeneous more or less around the world.”

Apparel climbed 37.2 percent to 19.8 million euros.

Sales in Italy gained 17.8 percent to 59.9 million euros. “This performance in Italy is not to be taken for granted and we are particularly happy with it,” Macellari said.

Revenues in Europe were up 18.3 percent to 57.3 million euros.

The company touted the strength of local demand and the important contribution of tourist purchases, especially from American, infra-European and Middle Eastern clients, in Italy and Europe, where tourists accounted for around 40 percent of sales, Macellari said.

In the Americas, sales rose 6.6 percent to 16.7 million euros.

The sales trend was positive, despite the shift abroad of a large part of the purchases of the American clients.

“We consider the U.S. a market of high importance and it is under-penetrated,” said Macellari, noting that the goal is to further develop this market.

In Greater China, revenues rose 29.2 percent to 88.6 million euros.

The region is maintaining double-digit growth rates both in Mainland China and, even more, in Hong Kong and Macau.

The performance of China was above that of 2021, said Macellari, and better than 2019.

Questions on China recurred throughout the call and Macellari said the company had seen “a visible acceleration” from mid- or end of January onward and “it is still going on.”

Macellari said he did not expect Chinese customers to travel outside Asia before the end of the summer.

He said South Korea was “suffering a bit” in terms of local customers, but that tourists were helping “with a better performance.”

Sales in the Rest of the World area showed a 32.8 percent gain to 48 million euros, driven by the excellent results of Japan, Singapore and the Middle East.

Macellari said the consensus of a 9 percent gain in revenues in the year to 1.1 billion euros should be “relatively easy” to achieve, and that an improvement of 150 basis points in margins can also be achieved despite the extra expenses and communication activities.

Retail sales rose 23.6 percent to 193 million euros, representing more than 70 percent of sales.

As of March 31, the group comprised 333 directly operated stores and 89 franchised units, compared to 318 directly operated and 86 franchised stores at the end of March last year.

Wholesale sales were up 22 percent to 77.5 million euros.

The e-commerce channel is doing well, which is reaping the results of the important investments made by the group in the digital world, said Macellari, adding that around 50 percent of online sales are derived from the direct channel and 50 percent from third parties.

Macellari said no price increases are planned for the fall season, after a 10 percent increase for the spring collections.

Asked about Tod’s collaboration with Lamborghini on a co-branded collection of leather goods, apparel, footwear and other accessories revealed in February, Macellari said this was a “very interesting and valuable brand,” which will help achieve higher visibility and boost Tod’s brand awareness, increasing its perception of luxury,” while adding that he did “not consider the partnership will bring an incredibly high volume of sales.”