MILAN — Global growth, led by emerging markets, and a continued strong appetite for designer-branded eyewear helped Luxottica Group post what it described as “the best first quarter” in its history.
In the three months ended March 31, net profits gained 14 percent to 131 million euros, or $171.6 million, compared with 115 million euros, or $161 million, in the same period the year before.
Sales grew 14.9 percent to 1.78 billion euros, or $2.33 billion.
GMO and Tecnol, which joined the group in July 2011 and January 2012, respectively, collectively contributed about 40 million euros, or $52.4 million, in revenues.
Dollar amounts have been converted at average exchange rates for the periods to which they refer.
Chief executive officer Andrea Guerra said Luxottica succeeded in growing in both traditional and emerging markets. “Highly gratifying results were reported in North America, where we successfully launched the new Coach collection and our retail brands also performed well,” he said, noting that all the group’s brands are “in excellent shape.” Company-owned label Ray-Ban celebrates its 75th anniversary this year and Oakley will take center stage at the London Olympic Games, continuing to grow at double-digit rates.
“Additionally, the entire portfolio of premium and luxury brands, led by Burberry, Tiffany and Prada, yielded solid results in the first quarter,” said Guerra. The group produces and distributes collections for brands including Dolce & Gabbana, Polo Ralph Lauren, Versace, Bulgari and Donna Karan. It has also secured the group licenses for Giorgio Armani, whose lines will bow in January.
“The results achieved in the first quarter of the year are an excellent foundation for the rest of 2012. Many of the markets in which we operate are in good shape, despite the difficult environment in the Mediterranean area of Europe where we see a degree of nervousness and fluctuations in trends, although Luxottica’s performance in this area remained positive in the quarter. As a result, we look towards the rest of the year with optimism, aware of the strength of our brands and the need to continue to be simple and fast in seizing the opportunities that present themselves,” said Guerra.
Emerging markets climbed more than 36 percent, with a peak of about 40 percent in Brazil, India and East Asia. Revenues in the U.S. rose 8.5 percent, mainly due to the performance of its wholesale division, which was up 18.1 percent, benefiting from the Coach launch. The LensCrafters and Sunglass Hut chains also contributed to the results.
Despite the difficult economy, Luxottica grew 6 percent in Western Europe.
Operating income rose 14 percent to 237 million euros, or $310 million.
Following the close of the Tecnol acquisition for about 90 million euros, or $118 million, during the quarter, as of March 31, net debt stood at 2.04 billion euros, or $2.67 billion, compared with 2.03 billion euros, or $2.84 billion, at the end of December.
Luxottica shares closed on Monday up 0.53 percent to 28.40 euros, or $37.12 at current exchange.