MILAN — Valentino’s bottom line and revenues in 2020 were hurt by the impact of COVID-19 and the related travel restrictions and closure of its boutiques due to the lockdowns worldwide.
On Friday, the Rome-based couture house reported a net loss of 127 million euros for the 12 months ended Dec. 31, compared with a profit of 33 million euros in 2019.
Earnings before interest, taxes, depreciation and amortization were halved to 146 million euros, down 51 percent compared to 298 million euros in 2019.
The company was more impacted in the first half of 2020. EBITDA in that period amounted to 39 million euros, representing 11 percent of revenues and a 75 percent decrease compared to 154 million euros in the first half of 2019.
A partial recovery was reported in the second half, with EBITDA of 107 million euros, representing 21 percent of revenues and showing a 25 percent decrease compared to 144 million euros in the same period of 2019.
As reported, online sales climbed 62 percent at Valentino and mainland China retail sales rose 44 percent in 2020, but this could not offset the consequences of the health emergency, which drove total revenues down 28 percent to 882 million euros. This compares with 1.22 billion euros in 2019. Online sales now represent 14 percent of total retail revenues.
Valentino touted its clienteling and remote sales strategy, further reinforced during the second half of 2020, which helped accelerate business. In the year, the Valentino online channel alone registered a 77 percent increase in sales.
Valentino reported an operating loss of 119 million euros in 2020. The adjusted EBIT, excluding the economic repercussion of the impairment testing, stood at a loss of 62 million euros. The impairment effect of 57 million euros was mainly due to the closure of some stores globally.
While chief executive officer Jacopo Venturini was not available for further comment, the company said in a statement that “today more than ever, it is fundamental to increasingly concentrate on creativity, human capital and personalized customer experiences. The focus on these key pillars provides a robust basis to navigate a global shifting landscape in the long term. In this regard, the new management has strongly implemented the first steps of the new strategy with signs of early positive results starting from the last quarter of 2020 and in the first quarter of the current year.”
Venturini, who joined Valentino in June last year succeeding the long-tenured Stefano Sassi, has been steadily building his team of executives, adding new roles to the company. In January, Enzo Quarenghi joined the house as chief client officer and digital acquisition. This position is part of a new division spearheaded by Venturini, to whom Quarenghi reports, and the new role signals Valentino’s increased focus on digital and an acceleration of its strategy to place customers at the center of its business, communication and marketing activities.
As reported, last October Valentino tapped Rosa Santamaria Maurizio as chief human resources officer — also a new role. A month earlier, Valentino named Laurent Bergamo CEO, Americas. Bergamo reports to chief commercial officer Marco Giacometti, who assumed his role in April 2020.
In April this year, Valentino tapped Mitchell Bacha as CEO for Greater China, tasked with helping grow the brand within that region, and signaling the firm’s increased focus on the region. He will support the company’s network extension, focusing on the retail channel, while continuing to strengthen brand awareness in the area and reinforcing its e-commerce presence.
There are 28 Valentino stores in Greater China and two openings are planned in China this year: One at Mall Center 66 in the city of Wuxi in May and one in Mall Deji in the city of Nanjing in August.
In May, Valentino tapped Masumi Shinohara as CEO, Japan and South Korea. There are 31 directly operated stores in Japan and 15 in South Korea. In February, Valentino opened a unit at Seoul’s Hyundai Yeouido Parc One department store. Six new directly operated stores are planned to open in South Korea in the next months.
The luxury house is controlled by the Qatar-based Mayhoola, which also owns Balmain and Pal Zileri.
Last year, Valentino expanded its store in Dallas and opened a unit in Mexico City for a total of 214 directly operated boutiques globally.
As reported, Valentino closed its Fifth Avenue flagship in New York and its store on Hong Kong’s Canton Road last year.
Last month, Valentino said it was revamping its positioning and going fur-free starting in 2022. It said it planned to focus on its signature line and to terminate its younger Red Valentino collection starting in 2024, which was produced in-house. Red Valentino was first launched in 2003.
The Milan-based Valentino Polar fur company, which has been fully owned by Valentino since 2018, will cease production at the end of 2021. The last collection to include fur will be the fall 2021-22 season.
The company is working closely with trade union representatives for the management of the organizational issues related to the closure of the fur company and in compliance with the regulations in the various countries, aiming to have a minimal impact on employees.