LONDON — Stella McCartney Ltd., the U.K. division of Stella McCartney, saw net profits rise 17.8 percent to 2.1 million pounds, or $3.3 million, in the year to Dec. 31, 2009, from 1.79 million pounds, or $2.8 million, in the previous year.
Frederick Lukoff, president and chief executive officer, attributed the rise in profits to “consistent, strong ready-to-wear collections,” coupled with strong accessory sales, particularly of the label’s Falabella bag.
Turnover at the company rose 8.7 percent during the year, to 14.6 million pounds, or $22.8 million, from 13.5 million pounds, or $21.1 million, in the previous year. Lukoff said the label had performed “very well” at both retail and wholesale, but declined to elaborate on the exact split between the two channels.
All currency figures have been calculated at average exchange rates for the period.
Noting the label’s strong performance in a difficult economic year, Lukoff said he believes McCartney’s “personality,” as reflected in the brand, resonates with consumers. “It’s very grounded, there’s a strong sense of reality in the brand…the style is applicable to the reality of [customers’] lives…and that’s meant that even in a very difficult year for the industry as a whole, we’ve actually had a great year,” said Lukoff. “And 2010 looks even significantly better.”
In terms of the current financial year, the company will launch a new Web site later this month, and will add U.K. e-commerce to the site, with the plan to then add the facility for European countries. In addition, the label’s first children’s collection will launch in November, following McCartney’s collaboration with Gap Kids last year. “The Gap [Kids] collection has been very, very successful for us and showed us that there was a demand for Stella in the kids world,” said Lukoff. “We’re very excited about the [Stella McCartney] kids collection.”
The 2009 fiscal results, which were filed earlier this week at Companies’ House in London, represent only part of the Stella McCartney business. Stella McCartney Ltd. is the U.K. legal entity that registers sales from the designer’s London flagship on Bruton Street and royalties from the designer’s licensing deals.
However, the label’s wholesale sales and sales from its six directly operated retail stores outside the U.K. are incorporated into the full year Gucci Group accounts and are not made public. Stella McCartney is jointly owned by the designer and Gucci Group.
Lukoff also said the label has more retail expansion planned for the coming year — following a store in Milan that opened in February, a store in Las Vegas’ Crystals mall will open in December. After that, Lukoff said the label plans to “accelerate” Stella McCartney’s retail expansion. “I think we can do more in the United States and Europe,” he said.
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