Prada Q1 earnings slide on Asia headwinds
- Q1 earnings slide to EUR58.7m (US$66m)
- Group revenues grow 6.5%
- Asia Pacific volumes fall "significantly"
Prada faced difficult market conditions in Asia Pacific
Italian fashion house Prada saw earnings in its first-quarter slide as the company faced headwinds and difficult market conditions in Asia Pacific.
Earnings in the three months to the end of April dropped to EUR58.7m (US$66m) from EUR105.3m a year earlier. The company said margins for the quarter were affected by limited growth in retail sales.
Consolidated revenues were up by 6.5% to EUR828.2m, thanks to the strengthening of other major currencies against the Euro, while retail sales grew 7%, at current exchange rates, to EUR749m.
Sales growth was particularly strong in Europe with increases of 11% at current exchange rates. The Japanese market achieved 6% growth in sales, and the company also recorded positive sales performances in the Americas and the Middle East, with revenue growth of 16% and 13%, respectively.
Asia Pacific, however, was less positive, with Prada admitting the situation in this region "remains more difficult" with volumes falling "significantly" in the quarter. The performance was affected by market conditions in Greater China, especially in Hong Kong and Macau, where the decline in Chinese tourist numbers "shows no signs of abating", the company said.
Nonetheless, Patrizio Bertelli, said: "The group continues with its review of operational processes in order to increase efficiency. At the same time, we are in the process of revising the group’s organisational structure, in order to bring it in line with the new business reality, which has grown considerably in size over the past few years."
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