ROME (DOW JONES)--Italian shoemaker Geox SpA (GEO.MI) Friday said its first-quarter net profit fell around 26% on lower sales, but said there are encouraging signs for future sales at its flagship stores.

Founder and Chairman Mario Moretti Polegato said in a statement the first quarter was "demanding" but he isn't worried because sales at its flagships stores are showing "encouraging" signs and orders for the autumn and winter collection were up more than 2% in world markets.

In a statement to the Italian stock exchange, Geox said in the first three months of the year its net profit fell to EUR53.6 million, from EUR72.4 million in the comparable period of 2009.

Geox, best known for its "breathable" shoes, said revenue fell to EUR333.1 million, down 13% from a year earlier, due to a contraction in consumer spending.

At 1212 GMT, Geox's shares were down EUR0.19, or 3.9%, at EUR4.7, underperforming the Milan's index of leading shares, which was down 3.6%. -By Chiara Vasarri, Dow Jones Newswires; +39 06 69766923; chiara.vasarri@dowjones.com

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