MILAN — Brunello Cucinelli has long spoken of his admiration for Amazon founder Jeff Bezos, who he has hosted on several occasions to talk about humanity and the future. But who does he admire among his fellow designers?
Think Ralph, Giorgio and Yohji.
In discussing his brand’s first-quarter results on Wednesday, Cucinelli, as usual, took the opportunity to opine on issues beyond the numbers, ranging from his optimism about the world in the months ahead to his new homeware corner at Harrods and including the designers he admires most.
Ralph Lauren tops the list, “a great master, who has created a visual merchandising unique in the world,” Cucinelli said of the American designer, whom he met in 2019. “He has always been a true, great inspiration for me,” Cucinelli said. “Inspiration is beautiful, but copying is not something I approve of. I trust I have created my own precise identity, through my connection with [the company’s headquarters in] Solomeo, the hamlet of cashmere and harmony.”
Cucinelli described Giorgio Armani as “a genius,” and also pointed to Yohji Yamamoto and “his shapes that are the most fascinating that I have ever known,” and Chanel.
“You create style through ready-to-wear,” continued Cucinelli, whose business mainly relies on apparel, “and I have been inspired by the big names that have a recognizable taste that lasts in time. [King] Edward VIII believed in a certain pleasure in dressing well, and his taste is still recognizable” after so many years.
But while expressing admiration for these designers, Cucinelli did not downplay the performance of his own brand, which continues to see strong growth. And he believes even better times are ahead.
“I can feel buzz and excitement, people want to return to shopping and dressing up to go out and have dinner with friends,” said Cucinelli, as he commented on a 5.1 percent gain in revenues in the first quarter of the year.
Strong growth in Asia and a solid performance in the U.S. and Europe helped balance a contraction in Italy, allowing Brunello Cucinelli SpA to post sales of 164.6 million euros in the three months ended March 31, compared with 156.7 million euros in the same period last year. At constant exchange rates, sales grew 7 percent.
The company also compared the performance with the first quarter of 2019, before the pandemic hit last year, showing a 2.6 percent gain in revenues to 160.4 million euros.
“It is with a feeling of great positivity that we disclose our results achieved in the first quarter of this year 2021, which we have defined as the ‘year of rebalancing,'” said the executive chairman and creative director of the company. “It was a very, very positive quarter, which indicates a gradual return to normality in daily life, with a strong desire for healthy planning.”
Cucinelli said that in light of the spring 2021 sell-out and the solid orders for fall 2021, he expected 2021 to show a growth in revenues between 15 and 20 percent. “We also see a healthy increase in sales for the year 2022 and 2023, of around 10 percent, and earnings before interest, taxes and depreciation of 17 percent of revenues,” he noted.
“This is the 44th year of the company, the 10th since the initial public offering and the first of a new cycle, which I hope will last 50 years at least,” he said. Once again, he stood by the 2019 to 2028 plan, which aims to have the company doubling its turnover in 2028 to reach revenues of about 1.1 billion euros.
In the first three months of the year, sales in Europe amounted to 50.9 million euros, representing 30.9 percent of the total, up 3.9 percent compared to 49 million euros in the same period last year. Compared to the first quarter of 2019, sales were up 1.6 percent. In the first first three months of the year, Europe benefited from sales in the regions with local customers.
“The results were very solid in central-northern Europe and the Russian Federation, while tourist cities, such as London, Paris and Milan, suffered more from the effects of the pandemic and lockdowns.”
That said, the stores that opened in London and Paris last year showed a positive performance during the periods when they had the opportunity to operate, confirming a strong medium-long term potential, remarked Cucinelli.
The company recently inaugurated a corner at Harrods in London entirely dedicated to homeware – tartan blankets, pillows, candles and art-de-la-table, and Cucinelli proudly mentioned it stood between Hermès and Dior.
“We took Harrods’ invitation to develop this corner very seriously, seeing it as further recognition of the attention paid to our taste and its immediate association with absolute luxury, even in this category,” said Cucinelli, who took the time to speak about the brand’s style throughout the call – and once again paying tribute to Lauren and how he has succeeded in identifying his label and lifestyle also through his home collections.
Sales in Italy were down 3.6 percent to 23.6 million euros, accounting for 14.3 percent of the total, compared to last year. Compared to the first quarter of 2019, local sales decreased 17 percent.
In the American market, sales amounted to 48.6 million euros, accounting for 29.5 percent of the total, down 4.8 percent compared with 51.1 million euros in the first three months of 2020, which had not yet been affected by the effects of the pandemic. The increase compared to the first quarter of 2019 was 4 percent confirming the favorable trend of the second half of 2020 where the North American market had shown great resilience in local demand. All channels helped the performance. Cucinelli said business had substantially picked up in the past five weeks, from Miami to New York, and accelerated in physical boutiques.
In Asia, sales totaled 41.6 million euros, representing 25.3 percent of the total, rising 28.9 percent compared to 32.3 million euros at the end of March last year. The growth compared to the first quarter of 2019 was 18.2 percent, with Mainland China reporting a very significant increase supported by the opening of new exclusive spaces and the expansion of boutiques. “Chinese customers feel safer at home and are shopping freely,” said Cucinelli.
Macao has already shown an increase compared to 2019 in this first quarter of 2021. “This dynamic supports our feeling that Hong Kong, now penalized by the complete absence of tourism, could return to normal levels of performance as soon as the borders reopen,” Cucinelli said.
Japan and South Korea also reported brisk business, boosted by local shoppers.
In the quarter, retail revenues amounted to 73.5 million euros, or 44.6 percent of the total, up 11.5 percent compared to last year. Compared to 2019, sales grew 3.2 percent.
Online sales amounted to 5 percent of the total.
While underscoring the importance of the online channel, Cucinelli touted the everlasting importance in his views of the brick-and-mortar stores and the assistance that a skilled and trained sales person can provide. Laughing, he recounted his own personal experience of entering a store to buy a watch and exiting with three — one at least was a Vacheron Constantin, he let slip.
As of March 31, the group’s network included 110 boutiques, three additional units compared to the end of March last year, with the expansion of the shops in London, Paris, St. Petersburg, Shanghai and Tokyo being completed in the last 12 months.
Wholesale revenues amounted to 91.1 million euros, accounting for 55.4 percent of the total, inching up 0.4 percent. The growth compared to the first quarter of 2019 was 2.2 percent.
As reported, Cucinelli has opened a vaccination center at its Solomeo headquarters, and works on this location started in early April. “Hopefully starting in May — depending on the number of vaccines available — we will be ready to organize three shifts per day so that any young person who wants to can get vaccinated at any time of the day or night. We believe that the sooner we complete the vaccination campaign the more lives will be saved, and the sooner the country’s economy can start growing again.”