MILAN — Sales of fine jewelry and a robust performance in the U.S. and the Far East helped Bulgari post an 8.9 percent growth in first-half sales. The Italian jeweler reported revenues of 487.8 million euros, or $634.1 million at average exchange rates, compared with the same period last year.
At constant exchange rates, sales would have grown 14.8 percent.
In the second quarter, sales increased 7.7 percent to 262.6 million euros, or $341.3 million, compared with the same period last year.
"The satisfying sales results of this first half confirm once again the strength of the Bulgari brand and the efficacy of the adopted strategies across all markets," said Francesco Trapani, chief executive officer of the Rome-based company, in a statement.
Trapani also underscored the performance of the company's retail network, which, as of June 30, totaled 232 stores, of which 136 were directly owned. "The distribution strategy focused on new important openings and on the enlargement and revamping of existing stores in prestigious locations worldwide has, in fact, already contributed to the outstanding performances registered in Europe and in the U.S.," said Trapani.
In March, the company reopened its New York flagship and, in the second half, will open two stores in Tokyo, which the company hopes will stimulate sales in the struggling Japanese market. In late October, Bulgari will open a flagship inside a new shopping center in the Omotesando district, and in December, a 10-story tower in Ginza will bow opposite the Chanel and Cartier flagships. In the first half, sales in Japan dropped 18.4 percent compared with the same period last year. "In accordance to the guidance already given to the market, I am therefore confident of an improvement in Japan in the fourth quarter," said Trapani.
The company also said in the statement that its directly owned stores showed "very aggressive" sales in the first half.
Jewelry, Bulgari's core business, grew 14.9 percent in the first six months, accounting for 42.3 percent of sales. The company said the new Assioma D timepiece, launched at the Baselworld Watch & Jewelry Show earlier this year, has been successful, helping Bulgari post a 3.3 percent increase in sales in the watch category. In the first half, watches accounted for 27.2 percent of sales.A weak Japanese market drove sales of accessories down 14.6 percent. The company attributed the drop to the relevance of Japan for the category and to early deliveries of the spring-summer collection. Bulgari has been investing in the accessories division with dedicated stores, for example, and accessories accounted for 8.3 percent of sales in the first half. The company, however, pointed to a "very high comparison base" last year: a 32.3 percent growth in the first half of 2006 versus the same period the previous year.
The lackluster performance of the accessories category was offset by a "robust and particularly brilliant growth" of the fragrance division, which grew 17.2 percent despite the absence of any product launches in the first part of the year. The division accounted for 18.9 percent of sales.
Bulgari cited "robust" sales in the U.S., where revenues grew 18.8 percent. The company said the performance of this market, which accounted for 17 percent of sales, was "very satisfying," adding that it was supported by the reopening of the brand's Fifth Avenue flagship in March. Sales in Europe grew 10.9 percent. Italy also showed vigor, with a 15.7 percent hike in sales. Sales in Asia outside of Japan increased 47.1 percent, showing "vitality" and "exuberant growth." The Far East, excluding Japan, accounted for 18.9 percent of sales, almost equaling revenues generated from that country. Japan in the first half accounted for 20.7 percent of sales. The company also underscored the "outstanding performance" of the Chinese market. The Middle East showed a 7.8 percent growth rate despite a strong comparison base, as that market showed 21.3 percent growth in the first half of 2006.
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