Puig Profits Rise, Market Share Gains

The Spanish fragrance and fashion group is now ranked sixth in the selective perfumery sector worldwide.

Marc Puig

BARCELONA — Puig has 2020 vision.

This story first appeared in the April 8, 2014 issue of WWD.  Subscribe Today.

As the Spanish fragrance and fashion group launched its centenary celebrations here Monday, it reviewed 2013 results and outlined future goals — including the aim to become the world’s third-ranked prestige fragrance player by 2020.

“Puig will be more sustainable; it will be greener,” said Marc Puig, the company’s chairman and chief executive officer, addressing journalists in the firm’s new headquarters, the Puig Tower. The meeting marked the first time Puig has held a conference to discuss its numbers.

“We have designed a 2020 plan that is quite ambitious — zero waste, zero gases, reuse of water,” he continued, adding Puig will be more “socially minded,” as well.

“We believe that companies cannot be blind to the duty to give back to society part of what society gives them,” said Puig, explaining the family — which owns the firm — will soon make a significant contribution to the Puig foundation to help back a number of employee social initiatives.

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“Puig’s future will be an ambitious one, too,” he continued. “We are the sixth world player in the selective fragrance industry. We have an 8.6 percent market share compared to the 3.2 percent we had in 2004. In 2020, we want to have 12 percent world market share [which]…would actually position us among the top-three world players.”

Puig also outlined the firm’s long-term aspiration: to be a group “that owns luxury labels — luxury brands recognized as such worldwide while keeping our hybrid model composed of our own brands and licensed brands in the world of perfume making. That’s our bet, that’s our commitment.”

During the press conference, Puig — parent of the Carolina Herrera, Nina Ricci, Paco Rabanne and Jean Paul Gaultier houses and licensee of fragrance labels such as Prada, Valentino and Comme des Garçons — said the company’s net income rose 2 percent in 2013 to 176 million euros, or $233.8 million at average exchange for the period.

Revenues at Puig advanced 1 percent to 1.5 billion euros, or $1.99 billion. On a like-for-like basis, sales were up 5 percent.

“[Last] year was a bit more complicated than we expected,” said Puig. “Our growth rate at a constant exchange rate was a reasonable one, 5 percent, but when we translate our sales into euros, the strength of the euro compared to the dollar and other emerging-market currencies had a significant impact. And that has continued this year.”

Still, Puig remains optimistic — not least about emerging markets.

“Our exposure to the emerging markets is among the highest in our industry and in spite of the impact that it has had during the past few months…we believe that medium to long term these growth dynamics for demographic reasons and for economic growth reasons will keep on being [positive],” he said.

Puig noted an encouraging trend in Spain, which for years had been hard hit by the recession and where the company generated 40 percent of its sales in 2013.

“At least the sloping down has stopped, and now we expect a turnaround,” he said.

He described the firm’s overall financial position as “solid.”

“It has no debt, and it has a cash position that is quite comfortable,” he said.

Following the press conference, numerous dignitaries visited the Rafael Moneo-designed Puig Tower, which is 3,280 feet high, covers 23 floors and has LEED Gold certification for its energy and environmental design. The company’s 100th anniversary celebrations are set to continue with events scheduled throughout this year, including the presentation of a Harvard University case study on Puig, a retrospective tome published by Assouline and a new corporate Web site due to go live on Tuesday evening.