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MILAN — Versace reported a drop in earnings last year because of unspecified costs, as sales climbed.
For the fiscal year ended Dec. 31, 2007, net profit fell 32 percent to 13 million euros, or $17.8 million. Chief executive officer Giancarlo Di Risio said without extraordinary costs, profits would have been in line with the 19.1 million euros, or $26.2 million, in 2006, but he declined to elaborate.
Operating profit advanced 18 percent to 25.1 million euros, or $34.4 million, over the same period while cash on the balance sheet totaled 4.4 million euros, or $6 million.
Versace registered sales rose 7.7 percent to 310.6 million euros, or $425.8 million, last year.
“This time we released more data concerning our results because they reflect the company’s growth and performance,” Di Risio said. “The figures confirm our economic stability and the financial equilibrium reached.”
He added that 2008 will be a brisk year in further developing and implementing in each product category, from watches to accessories, but stressed that no new licenses are on the horizon.
All dollar figures are converted at average exchange rates for the period to which they refer.
The company reported earnings as it prepares next week to launch the first dedicated Versace Home flagship in the heart of Milan.
Versace Casa, which started in 1992 with a few linens and porcelain pieces, is now a full lifestyle collection that recorded 2007 sales of 69.5 millions euros, or $95.3 million, a 12.5 percent leap against the previous year.
“We are the leaders in the designer home arena and we’ve grown significantly over the past two years thanks to a more streamlined image,” Di Risio said. “The strength of this division lies in the fact that we don’t simply sell furniture or upholstery, but a luxe Italian lifestyle concept.”
Viewed as a robust growth avenue, Donatella Versace and Di Risio have ambitious plans for the home division.
They will inaugurate the flagship on April 16, two levels spread across 5,400 square feet that mirror the airy and modern blueprint of Versace’s ready-to-wear stores. Di Risio said future Versace Casa openings are slated for New York, Dubai, Brussels and Paris.
This story first appeared in the April 11, 2008 issue of WWD. Subscribe Today.
The white and neutral interiors in Milan are decorated with precious marbles and crystals, while silk jacquards share wall space with honey-colored boiserie.
In a service-driven move, interior designers and architects will be on hand free of charge for customers seeking advice when planning a residence.
Besides acting as a backdrop to the furniture, linens and tabletops, the venue will serve as a dynamic art gallery in which young Italian artists can exhibit and sell their works. There will be artwork by guest artist Bruno Gianesi, who in the early stages of his career worked with Gianni Versace, developing panels for prints and scarves.
Milan’s Versace Home outpost is part of a $70 million investment channeled to open 11 stores this year, mainly in China. A specific figure for Milan was unavailable.