MILAN — The luxury world’s outlook may appear a bit patchy for some, but Brunello Cucinelli SpA is bucking the trend.
Boosted by international growth, the Italian luxury firm saw net profits rise 17.8 percent to 15.6 million euros, or $21.3 million, in the six months ended June 30, compared with 13.3 million euros, or $17.4 million, in the first half of 2013.
As reported, the company posted revenues of 175.8 million euros, or $239 million, up 11.6 percent compared with 157.6 million euros, or $206.4 million, in the same period last year.
Cucinelli continued to grow around the world, with exports gaining 15 percent in the period, accounting for 79.4 percent of total sales.
Dollar amounts are converted at average exchange for the periods to which they refer.
The company’s namesake chairman and chief executive officer said he believes this “really special performance” will be confirmed in the second half of the year, with double-digit growth in profit and revenues. The entrepreneur told WWD that he attributed the expansion of the brand to a “return of production in Italy, which is synonymous with creativity and manufacturing capacity. There is an increasing and unwavering distinction between quality products made by hand, expensive and recognizable, and those that are lower priced and more industrial.”
Cucinelli said he feels that customers are “returning to a rapport in the use of things. [Ancient Greek philosopher] Epicurus said men need to heal the soul with serenity and the body with needs. We have now gone beyond consumerism — a word I don’t like. We are returning to the truth of things, a respect for nature, and a more balanced use of things, triggered by a reawakening of ideologies.” Cucinelli mentioned a revived interest in Italy, the arts, spiritual life and politics. He was also “very positive” for 2015, expecting double-digit growth next year — a future he sees “beautiful and rosy,” based on the orders for both the men’s and women’s collections.
Staying true to his belief in the need to invest in local production, Cucinelli said investments relating to production and logistics, which reached 8.9 million euros, or $12.2 million, in the period, include expenditure incurred for extending the Solomeo manufacturing facility. “We have already moved here, we are very happy and fully operative,” he said.
As of June 30, the company invested a total of 22.4 million euros, or $30.6 million. This included commercial investments in the growth of its boutique network for a total of 10.2 million euros, or $14 million. In the first half, the company also initiated a three-year investment project relating to the strengthening and development of its IT infrastructure platform, which will include resources to support the brand’s digital presence in line with its exclusive positioning.
In the first half, revenues in Italy inched up 0.2 percent to 36.3 million euros, or $49.3 million, representing 20.6 percent of the total, while sales in the North American market rose 18.2 percent to 55.4 million euros, or $75.3 million, representing 31.5 percent of the total. Europe gained 9.5 percent to 60 million euros, or $81.6 million, accounting for 34.2 percent of the total. Greater China grew 43.5 percent to 10.4 million euros, or $14.1 million, representing 5.9 percent of total sales. At the end of June, the group counted 19 boutiques in Greater China.
Sales in the Rest of the World rose 10.3 percent to 13.7 million euros, or $18.6 million, representing 7.8 percent of the total.
At the end of June, Cucinelli had 102 boutiques, of which 65 were directly operated, compared with 92 units at the end of June last year.
The three wholesale monobrand boutiques currently existing in Japan will be converted to directly operated starting Monday. Likewise, the dedicated spaces in the 13 luxury department stores in Japan will also become part of the retail channel.
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