• Q3 profit falls 43.8%
  • Gross margin narrows to 72.3%
  • Sales fall 5.6%
Prada said 2014 is proving to be more challenging than expected

Prada said 2014 is proving to be more challenging than expected

Italian fashion house Prada has said it is taking further action to improve its operating performance after revealing a drop in third-quarter earnings and sales.

Prada's net profit in the three months to the end of October fell to EUR74.5m (US$91.6m), a 43.8% drop on the prior year's earnings of EUR132.6m.

Gross margin narrowed to 72.3% from 75.7%, while net sales dropped 5.6% to EUR800.7m.

Chief executive, Patrizio Bertelli, said 2014 is proving to be a more challenging year for the company than expected. He pointed to the ongoing difficult international economic environment as a contributing factor.

"We are confident in the medium-term growth prospects of the market, but also aware of its increasing level of complexity," he added. "Consequently, we remain convinced that we have made the right choice in continuing to prioritise the group's medium-term development, through investments focused on achieving qualitative and stylistic excellence.

"We are also working on making our business structures more efficient and improving the operating performance of our stores, in order to ensure the group achieves satisfactory levels of profitability."