MILAN — Significant growth in the accessories category, gains in the core jewelry business and strong sales domestically and in Asia helped Bulgari SpA more than double net profits in the three months ended Sept. 30.
The Italian jeweler said profits rose to 16.6 million euros, or $21.4 million, surging 137.8 percent compared with 7 million euros, or $9.9 million, in the same period last year. Revenues grew 14.9 percent to 267.9 million euros, or $345.6 million, compared with 233.2 million euros, or $331.1 million, in the third quarter last year. Cost control helped operating profits rise 44.5 percent to 26.8 million euros, or $34.5 million. Dollar figures are converted at average exchange rates for the periods to which they refer.
“We are going in the right direction, as was expected, and our business and the company are growing,” chief executive officer Francesco Trapani told WWD.
“These results are a consequence of both our cyclopic efforts and a general economy that has moderately improved,” said Trapani, adding that they are in line with Bulgari’s three-year plan and expectations.
The ceo said October’s consolidated net income grew 12 percent at comparable exchange rates. He said, barring “catastrophic news,” he was optimistic for the Christmas sales season.
Sales of jewelry, which remains the company’s core business, accounting for 44.5 percent of revenues, rose 24.2 percent, partially as a result of the strong performance of the B.zero1 line and the Serpenti collection. Watch sales decreased 1.8 percent. The company said new products this year were available starting in September, compared with launches last year beginning in the second quarter.
Bulgari also underscored a recovery in the wholesale channel in October, following last year’s “massive” destocking. Perfumes, the brand’s second top category accounting for 23.2 percent of sales, showed a 3.5 percent increase. At the end of the third quarter, the company started rolling out the new Man perfume for men, fronted by Clive Owen.
Trapani was pleased with the performance of the firm’s accessories division, which gained 54.8 percent. “We are very satisfied with the performance of both jewelry and accessories, which is also part of our core business now,” he said. “We’ve invested on the product, and are now credible. We have achieved more notice.” Steps to achieve this included tapping actress Julianne Moore for the fall campaign; the Isabella Rossellini bag, created with the actress, and the capsule collection designed by Matthew Williamson. The division in the third quarter accounted for 9.6 percent of sales, and Trapani said there was still “a lot to do.”
Geographically, sales in Europe rose 11.1 percent, with Italy showing 24.4 percent growth. “Europe improved with a return of tourism,” said Trapani. The U.S. posted 1.8 percent growth. “A year ago, I was very skeptical, because this is a country that is heavily indebted, but then business picked up in 2010,” said Trapani. Sales in Asia grew 24.7 percent, with Japan registering an 18 percent gain and the rest of Asia 30.1 percent. At comparable exchange, Greater China showed a 24.3 percent rise. “Greater China is extraordinary,” said the executive.
Finally, although the Middle East/other regions recorded a 1.5 percent drop, this is an improvement, compared with the second quarter, when sales decreased by 10.8 percent.
Bulgari reduced its debt, which, as of Sept. 30, stood at 241 million euros, or $310.9 million, compared with 328 million euros, or $465.7 million, at the end of September last year.