“We are extremely pleased with the results achieved this quarter in terms of sales and profitability, especially as we have achieved them in an uncertain and very unpredictable international environment”, said Patrizio Bertelli, CEO of Prada.
Italian fashion group Prada said Thursday that its profits more than doubled in the first quarter thanks to sales in Europe and Asia but added that it was staying cautious on the economic outlook.
Net profits at the Milan-based group, which listed on the Hong Kong stock exchange last year, rose 105.6 percent to 164.8 million euros ($207.4 million) from the first quarter of 2011, the company said in its earnings statement.
Gross revenues (Ebitda) went up 77.2 percent to 200.1 million euros and turnover also rose 47.9 percent to 686.8 million euros.
Prada said it had benefited from a 55.5-percent rise in European sales thanks to "a growing influx of tourists," as well as a 46.9-percent increase in the Asia-Pacific region and a 38.7-percent boost in Japan.
Sales were up 34.1 percent in North America, Prada said.
“We are more certain than ever that we have chosen the correct route to growth based on a balanced geographical presence around the world and on the strength of our brands,” assured the top executive at the Italian luxury label.
Prada, which floated in Hong Kong a year ago, said revenue climbed 47.9%, above estimates. In the three months ended in April, earnings before interest and tax rose 106% to 164.8 million euros, driven by retail sales, and declining markdowns.
Listed in Hong Kong, Prada's shares have gained nearly 30% so far this year, easily outperforming the benchmark Hang Seng Index's 1.3% gain.
“We remain confident of our ability to achieve our objectives and shall closely monitor the economic situation in the countries where we operate to ensure that our strategy of medium-term growth is compatible with requirements on the various markets”, said Bertelli.
According to Barron´s, Prada gets 37% of its revenues from Europe, but only 17% of that is actually sold to Europeans. Most of the rest is sold to Asian and specifically Chinese tourists. Counting the nationality of the buyer rather than the location of the sale, 57% of the group's revenues are estimated to come from non-Japanese Asians and another 12% come from Japan. All told, nearly 70% of Prada's sales go to the East.