By  on May 16, 2007

MILAN — Bulgari SpA posted higher-than-expected first-quarter figures, boosted by sales of fine jewelry and the recently relaunched Bulgari pour Femme fragrance.

Net profits for the three months ended March 31 rose 31.5 percent to 23.9 million euros, or $31.3 million. Sales for the period advanced 10.4 percent to 225.1 million euros, or $294.9 million. Bulgari said revenues would have grown 16.4 percent at constant exchange rates.

Dollar figures have been converted from the euro at average exchange rates.

"The year started off well and we had a good April," Bulgari chief executive officer Francesco Trapani said in an interview, adding that orders were brisk at last month's Baselworld Watch & Jewelry Show. "Things are going in the right direction."

Trapani said he harbor's concerns regarding currency woes and the high price of gold, but he's optimistic about the state of the luxury market in general.

Trapani said full-year net profits and sales should grow between 8 and 12 percent at constant exchange rates.

First-quarter operating profits rose 20.4 percent to 26.3 million euros, or $34.4 million.

Europe and Asia excluding Japan registered the highest growth levels for the company, while revenues slipped in Japan and the Americas.

Sales in Europe rose 15.9 percent to 84.4 million euros, or $110.6 million. Revenues in Asian countries excluding Japan advanced 75.6 percent to 44.9 million euros, or $58.8 million. In particular, Bulgari noted its "brilliant performance" in China.

Trapani shrugged off the fact that revenues in the Americas slipped 3.7 percent to 33.7 million euros, or $44.2 million. The ceo attributed the dip to store renovations in New York. Bulgari's Fifth Avenue flagship reopened in late March and won't impact sales until the second quarter. Trapani said the refurbished store had an "excellent" April.

Meanwhile, Bulgari's Madison Avenue store also was closed for the first quarter. It will open this year.

As for Japan, Trapani reiterated the company is hoping that two major store openings in Tokyo this year will stimulate sales. First-quarter sales there dropped 16.1 percent to 48.6 million euros, or $63.67 million, but Trapani said he thinks Bulgari will end the year with "flattish" revenue in Japan.In early December, Bulgari will open a 10-story tower in Ginza opposite the Chanel and Cartier flagships. In late October, Bulgari will open a flagship inside a new shopping center in the Omotesando district.

First-quarter jewelry sales rose 18.2 percent to 94 million euros, or $123.1 million. Unfavorable exchange rates bit into watch revenues, which rose just 0.3 percent to 58.5 million euros, or $76.6 million. Bulgari blamed the flat timepiece performance on tough comps from the previous year.

The recently relaunched Bulgari pour Femme fragrance propelled a 27.2 percent jump in beauty sales to 43 million euros, or $56.3 million.

Bulgari's accessories unit did not fare as well. Its first-quarter sales dropped 17.1 percent to 21.1 million euros, or $27.6 million. A combination of factors, including weakness in Japan and tough comps, bit into sales. Trapani said he's optimistic Bulgari can succeed in this competitive field.

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