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De' Longhi cuts 2022 sales guidance as Ukraine crisis clouds outlook

MILAN, March 10 (Reuters) - Italian home appliances maker De’ Longhi revised downwards its 2022 sales guidance on Thursday as Russia’s invasion of Ukraine increased risks for the business in those two markets.

The company said it expected organic revenues for the current year to be in line with the previous one, compared to a mid-single digit growth forecasted in January. “There are now risks that the ongoing conflict.. will have material repercussions on the Russian and Ukrainian markets, for whose assessment we believe it is necessary to use great caution,” De’ Longhi said in a statement.

Russia and Ukraine markets accounted for 4.9% of De’ Longhi’s total revenues in 2021.

The new guidance sent the group’s share down as much as 9.5% on the Milan bourse. At 1540 GMT they were down 7%, underperforming Milan’ all-share index.

In the last year the group’s revenues crossed the threshold of 3 billion euros ($3.3 billion) from 2.4 billion the previous year, thanks to a solid demand in the main core segment of coffee and food appliances.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totalled 515 million euros, up 40.5% year-on-year.

De’ Longhi said it would stick to its investment plan which would bring the adjusted EBITDA in 2022 to around 450 million euros.

The investment plan includes a global campaign with Brad Pitt promoting the De’ Longhi brand in the coffee segment, plus spending on organisational and production structures. ($1 = 0.9087 euros) (Repoting by Andrea Mandalà Editing by Keith Weir)

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