MILAN — Moncler presented its initial public offering to the financial community on Monday, ahead of the brand’s first day of trading on the Milan Stock Exchange, which is expected on Dec. 16.
An upbeat and visibly pleased Remo Ruffini, chairman and creative director of the company, who had shelved the project to publicly list the company in 2011, said “the mood today is better” remembering concerns over a crisis in Greece and the euro currency at that time. He called the listing “a tribute to success, without arrogance, but with humility and pride.”
The road show, which kicked off Wednesday, will close on Dec. 11. The company is floating 26.7 percent of its share capital, or 30.7 percent with the Greenshoe option. The IPO will value the company at between 2.19 billion euros and 2.55 billion euros, or $2.97 billion to $3.46 billion. “The offer has been more than covered,” said Stefano Rangone, an executive from Mediobanca, one of the global coordinators, following rumors that shares have already been oversubscribed 12 times. Ruffini noted that there are no plans to close the offer in advance. The shares are expected to be priced at the high end of the range, at 8.75 euros to 10.20 euros a share, or $11.87 to $13.84.
Gianluca Pacini, luxury analyst at Intesa SanPaolo, said Moncler is “a strong brand in terms of design and product,” and that it has shown a strong growth record. “This is the right moment, there are not many companies with these multiples that have no problems in investing in 2014,” he noted, waving away any possible issue over the fact that Moncler’s success hinges primarily on a mono-product, its down jacket.
“There is a lot of interest in the market for beautiful stories, and this is a beautiful story,” said Luciano Santel, Moncler’s chief corporate officer. “And there are many categories within the brand that can still be developed.”
Ruffini said during the presentation, held in a packed room at Milan’ s exclusive and historic gentlemen’s club Società del Giardino adorned with larger-than-life statues of ducks, the brand’s logo, that he would like to develop “special products. We want to become specialists in other sectors, but we will not do total-look collections. Customers are very attentive to quality.”
Monica Sottana, general manager, underscored Moncler’s “significant untapped potential,” with plans, for example, to set up an industrial platform dedicated to knitwear and a product engineering team.
Ruffini, who was instrumental in relaunching the brand since he acquired it in 2003 and who holds a 32 percent stake, reiterated he has no intention to sell shares in the company after the listing. He has a one-year lock-up period.
There will be no capital increase. “The company has enough cash flow to pay for investments, dividends and reimburse debt,” said Ruffini. “We want a gradual, reasonable and controlled growth.”
Moncler’s selling partners are ECIP M., controlled by Eurazeo SA; CEP III, controlled by The Carlyle Group, and Brand Partners 2, controlled by Progressio Investimenti. Eurazeo holds 45 percent of the firm; Carlyle, 17.8 percent, and Progressio Investimenti, 4.9 percent.
On Thursday, ECIP M said it would put 36.85 percent of its shareholding interest up for sale, and that six days after the IPO it would allocate 5.08 percent of Moncler’s capital to non-Eurazeo shareholders and Eurazeo Partners, leaving it with 23.3 percent of Moncler capital. Eurazeo SA — thus having sold roughly 37 percent of its Moncler shares in all — would be left holding about 19.7 percent of the fashion brand’s share capital, taking into account its investment in Eurazeo Partners.
Marco De Benedetti, head of The Carlyle Group, said there is no rush to sell and the fund will “disengage in two to three years.” He defined the pricing of the shares “in line with the company. There was no need to try and hike the price, we want a correct positioning for the firm.”
Andrea Tieghi, senior director of retail business and development, said the company has been opening 20 stores a year since 2010 and plans to continue to do so. There are now 1,800 multibrand stores, down from 3,000 in 2005, as a consequence of a selective distribution strategy; 24 shops-in-shop, and 98 directly operated stores. Retail sales in 2012 accounted for 51 percent of revenues compared with 27 percent in 2010. As of September, like-for-like sales in directly operated stores grew 18 percent compared with the same period the previous year.
Global net profit last year reached 82.4 million euros, or $105.4 million, compared with 55.9 million euros, or $73.8 million, in 2010. Santel said the company has grown 32 percent in the past three years, reaching sales of 489 million euros, or $626 million.
At the end of 2012, net debt was reduced to 229 million euros, or $293.1 million, from 270 million, or $375.3 million, in 2011. Dollar amounts were converted from the euro at average exchange for the periods to which they refer.
It was revealed that Alessandro Benetton, chairman of the Benetton Group, has become a member of Moncler’s board.
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