REPORT The Prada Group said, consolidated net revenues for the six months ended July 31, 2015 amounted to 1,824.4 million euros (2,065.7 million dollars), with a 4.2 percent increase, at current exchange rates, on the corresponding period in 2014.
Commenting on the company’s performance, Patrizio Bertelli, Chief Executive Officer of Prada said, “The luxury goods market is undergoing a period of significant change which must be met with a far-reaching, long-term strategy. The Group’s primary objective remains the creation of value in the long-term for shareholders, our customers and employees.”
Retail sales up while wholesale declines
The increase is entirely attributable to the retail channel, as a result of the selective strategy pursued by the Group with the aim of further enhancing the activities of its directly operated stores. Consequently, wholesale channel sales for the period decreased to stand at 249 million euros (281.9 million dollars) or below 13.8 percent at current exchange rates, in line with the ongoing rationalization of the network of wholesale partners.
Meanwhile, the sales of the Group’s retail network increased by 7.6 percent at current exchange rates. On top of the positive exchange rate effect, the 605 directly operated stores (DOS) also benefited from general improvement in sales performance.
The European market continued to grow with revenues for the first six months of the year up at both current exchange rates with 12.4 percent and constant exchange rates with 10.8 percent owing to a steady flow of tourists together with a recovery in consumption by domestic customers. The Japanese market also performed well with growth at both current exchange rates with 11.7 percent and constant exchange rates with 4.9 percent and double digit rates of growth achieved throughout the second quarter.
However the Asia Pacific market showed the same negative trend as in the first quarter of the year, offset by a positive exchange rate effect. Hong Kong and Macau remain the markets which mainly affected the weak performance in this geographical area. At current exchange rates, sales increased in the Americas and in the Middle East both by 15 percent.
Sales performance by brand
Prada recorded a 5.4 percent increase at current exchange rates, entirely attributable to the exchange rate effect, and has been impacted by the negative economic situation in the Asian market. Meanwhile, Miu Miu continues to grow with revenues up at both current exchange rates with 18.7 percent and constant exchange rates by 6 percent and an acceleration achieved in the second quarter of the year. Church’s has also achieved sales growth of 18.6 percent at current exchange rates with the volumes trend also remaining largely positive. Finally, Car Shoe has performed broadly in line with prior year.
EBITDA for the first half of the year increased 24.1 percent of consolidated net revenues, while EBIT increased 16.1 percent of consolidated net revenues. Net Profit increased 10.3 percent of consolidated net revenues.