Prada Group challenged by weak Greater China
Prada Group sales for the six months ended July 31, 2015 amounted to Euro 1,823 million, with a 4% increase compared to the same period in 2014, entirely thanks to the retail channel which more than compensated for a decrease in wholesale channel sales.
Sales of the wholesale channel for the period ended July 31, 2015 totaled Euro 248 million have declined by 14% at current exchange rates, in keeping with the strategy of rationalization of the network of wholesale partners.
In contrast, sales of the Group’s directly operated retail network have grown by 8% at current exchange rates to Euro 1,552 million, benefiting from the positive effect of exchange rates accompanied by a general improvement in sales performance.
The European market has continued to grow with revenues up at both current exchange rates +12% and constant exchange rates +11%, thanks to a steady flow of tourists together with a recovery in consumption by domestic customers.
The Japanese market has also performed extremely well with growth at both current exchange rates +12% and constant exchange rates +5%; double digit rates of growth were achieved throughout the second quarter.
Meanwhile, the Asia Pacific market shows a similar negative trend, as in the first quarter of the year, offset by a positive rate exchange effect. Hong Kong and Macau remain the main drivers affecting the performance in this geographical area.
At current exchange rates, sales increased in the Americas and in the Middle East reaching 15% growth in both markets; in the Middle East, performance improved significantly in real terms in the second quarter.
The Miu Miu brand continues to grow with revenues up at both current exchange rates +19% and constant exchange rates +6%, outperforming the Prada brand which recorded 5% growth. Church’s has also achieved sales growth, +19%, with the volumes trend also remaining largely positive. Car Shoe has remained the worst performing brand of the group.
Patrizio Bertelli, CEO of Prada Group, commented: “Sales in the first half of 2015 reflect an economic and exchange rate landscape that remains rather volatile with the continuing weakness of important markets like Hong Kong and Macau and the uncertainty that is looming on other Asian markets. Our distribution structure, which has achieved an appropriate global presence, together with our awareness of the specific needs of the various markets, has enabled us to compensate for the drop in sales in Asia Pacific thanks to growth on markets which are currently more dynamic like Europe and Japan.”