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Aeffe Profits Climb

Continued strong growth in both wholesale and retail sales and growing demand in all markets, bar the U.S., boosted the bottom line.

MILAN — Continued strong growth in both wholesale and retail sales and growing demand in all markets, bar the U.S., boosted the bottom line at Aeffe SpA, which reported a net profit of 5.3 million euros, or $7.5 million, in the third quarter, compared with 1.2 million euros, or $1.5 million, in the same period a year ago.

Dollar amounts have been converted at average exchange for the periods to which they refer.

Aeffe — which produces and distributes collections for Alberta Ferretti, Moschino, Pollini, Jean Paul Gaultier and Cacharel — said consolidated revenues in the three months ending Sept. 30 jumped 10.1 percent on the year-earlier period, to 77.5 million euros, or $109.3 million.

The company put in a strong sales performance in all geographic areas, except the U.S., even as the global economy continued to show signs of weakening. In Italy, the company’s largest market in terms of revenues (42.6 percent of sales), the top-line increased by 8.7 percent in the July-to-September period.

European sales increased 12.8 percent, Russia gained 24 percent, Japan grew 20.1 percent and the “rest of world” was up 7.2 percent; in the U.S., sales decreased 2.6 percent. All figures are at constant exchange rates, the company said.

In terms of sales networks, the retail and the wholesale channels grew by 10.1 percent and 9.3 percent, respectively, in the third quarter.

Pointing to the company’s strengthening performance since the beginning of the year, Massimo Ferretti, executive chairman of Aeffe, stated that “the orders backlog for spring collections was positive and this leaves us confident about the trend of the next year.”

For the first nine months of the year, Aeffe reported a net profit of 100,000 euros, or $140,000, reversing a year-earlier loss of 5.1 million euros, or $6.7 million. Sales in the period jumped 14.3 percent, reaching 197.4 million euros, or $278.3 million.

Profitability from January through September “improved significantly” on the year-earlier period, Ferretti said in the statement, following the increase in revenues and the lower incidence of the operating costs “thanks to the policy of costs’ reduction and efficiency improvement implemented at group level.”

In the period, EBITDA, or earnings before interest, taxes, depreciation and amortization, was 19.1 million euros, (9.7 percent of consolidated sales), or $26.9 million, compared to an EBITDA of 5.9 million euros, (3.4 percent of sales), or $7.8 million, in the same period of 2010.

In the first nine months, revenues of the prêt-à-porter division amounted to 157.8 million euros, or $222.5 million, up by 10.3 percent at current exchange rates and by 10.7 percent at constant exchange rates compared to the year-earlier period, while sales in the footwear and leather goods division increased by 31 percent, reaching 50.7 million euros, or $71.5 million.