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T O D ’ S S PA

RISKS (2) Regional Risks ■ 78.4%* of Tod’s revenue is generated by three

key markets: Italy (31.0%), Europe (25.4%) and Greater China (22.0%). Therefore, any significant change in these regions’ economic/political outlook will affect consumer confidence, and hence Tod’s business performance.

Rising Input Costs ■ The price of leather, one of Tod’s key input costs, can fluctuate significantly, contributing to the volatility in margins and profits.

Increasing Head Count ■ The number of employees at Tod’s has continued to increase, while revenue growth has slowed and

even turned negative. The Company has not managed its cost base adequately in our view, and while we understand the need to maintain quality standards and investment in the future, we also wish to see some cost discipline implemented.

TOTAL SALES VS HEADCOUNT SINCE 2006 € 1,200M

5,000 4,500

€ 1,000M

4,000

Total Sales

3,000 €600M

2,500 2,000

€400M

1,500

# of Employees

3,500

€800M

1,000

€200M

500 € 0M

0 2006

2007

2008

2009

2010

Total Sales

2011

2012

2013

2014

2015

2016

2017

# of Employees

* Tod’s SpA FY2017 Annual Report

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Profile for Richard

Elevation Capital Research Annual 2018  

Elevation Capital Research Annual 2018