MILAN — Moncler SpA provided a business update on Thursday after a board meeting to approve the 2019 financial statements, with the expectations of “important impacts” in a first half hit by COVID-19.
The luxury company also revealed it had inked a worldwide license agreement with Interparfums SA for the production and distribution of branded perfumes and fragrance-related products.
The license will expire on Dec. 31, 2026, but has the potential for a five-year extension. The launch of the first fragrance line is expected within the first quarter of 2022.
Under the agreement, the products will be distributed in Moncler monobrand stores as well as select department stores, specialty stores and duty-free shops.
“Interparfums’ renowned expertise and creativity make it the ideal partner to develop a fragrance that is perfectly aligned with Moncler’s DNA and unique identity,” said Moncler’s chairman and chief executive officer Remo Ruffini. “The launch of Moncler’s first fragrance line is consistent with our selective brand extension strategy further enriching the clients’ experience with the brand.”
Founded by Philippe Benacin and Jean Madar in 1982, Interparfums is the worldwide licensee for brands ranging from Boucheron, Coach and Jimmy Choo to Karl Lagerfeld, Kate Spade, Montblanc, Paul Smith and Van Cleef & Arpels, among others. The company is also the owner of Lanvin fragrances and the Maison Rochas. With products
sold in over 100 countries worldwide through a selective distribution network, Interparfums reported sales of 484 million euros in 2019. The company is listed on Euronext Paris, while Moncler is listed on the Italian Stock Exchange.
“This is a great achievement for us,” said Benacin, chairman and ceo of Interparfums. “Moncler is the only luxury brand associated to mountains, nature and a constant search for innovation and evolution. Moncler has always stood for uniqueness, authenticity, quality and excellence. Its achievements are absolutely distinctive, and we are certain that its uniqueness will be successfully translated into a fragrance.”
Moncler at the end of trading on Thursday addressed the impact of the COVID-19 pandemic on the group’s business and on the actions undertaken. The lockdown measures globally affected the brand in the first months of 2020 in several markets and all distribution channels in which the company operates.
As of Thursday, 36 stores worldwide were closed out of 212 in total. In January and February, 12 retail stores were closed in Asia for an average of 30 days, while at the end of March, 111 directly operated stores were temporarily closed, 123 at the end of April and 43 at end of May. The wholesale distribution was also impacted, “with significant effects on the performance of the channel.”
The company faced complexities in regards to its supply chain and logistics and related to the creation of collections and the procurement of raw materials, as well as the closure of its distribution centers for its online business. “Currently, supply chain and logistics have returned to a substantially normalized situation, although still influenced by social distancing measures,” stated Moncler.
The group’s management continued to encourage remote working even after the end of lockdowns in various countries, including Italy. In addition, Moncler is offering serological tests and swabs. To encourage individual transportation, it is providing bicycles to all employees who live in Milan and has acquired a machine for the production of surgical masks to be used by its employees and the community.
In light of the situation, Moncler is focused on its essential projects “while postponing what is considered not urgent with a strong focus on digital and online which remain pillars of the group’s future strategy.”
In April, chief corporate and supply officer Luciano Santel said all nonessential projects, including a few retail ones, have been postponed, with a 30 percent reduction in total capital expenditures. Regarding marketing costs, some advertising campaigns and events have been suspended while budgets for traditional media have been reduced. ln addition, discussions with all landlords have been opened in order to renegotiate rents.
One of the priorities is also to support customer loyalty and engagement, including those who are shopping in their domestic markets and are unable to travel. Flexibility remains key in these “highly uncertain” times and difficult markets such as Europe and the Americas.
“These circumstances will have important impacts on the performance of the group’s first-half results, also considering that, evidently the second quarter to date has been more severely impacted by the temporary closure of a larger number of stores compared to the first quarter of 2020,” the company said.
Revenues rose 15 percent to 1.62 billion euros, compared with 1.42 billion euros in 2018. The company saw an acceleration in the last quarter, with sales growing 16 percent.
In the three months ended March 31, the measures adopted globally to contain the coronavirus spread affected the performance of the company. Sales were down 18 percent to 310.1 million euros, compared to 378.5 million euros in the first quarter of 2019.