MILAN — Designer brands helped lift OTB’s performance in 2016, while Diesel was dented by a repositioning.
OTB, which controls the Maison Margiela, Marni, Paula Cademartori and Viktor & Rolf labels, as well as production arms Staff International and Brave Kid, closed 2016 with net profits up 8.5 percent to 3.8 million euros, or $4.2 million, compared with 3.5 million euros, or $3.8 million, in 2015. Revenues were in line with the previous year, totaling 1.58 billion euros, or $1.73 billion.
Earnings before interest, taxes, depreciation and amortization were also in line with the previous year at 68 million euros, or $74.8 million.
Maison Margiela, under the creative direction of John Galliano, reached sales of 135 million euros, or $148.5 million, from 100 million euros, or $122 million, two years ago. As reported in February, Margiela has appointed Diesel executive Riccardo Bellini as its new chief executive officer, succeeding Giovanni Pungetti. Pungetti, one of the most senior executives in the Italian group, is to become ceo for the Greater China region, overseeing all of OTB’s brands present in the region. OTB ceo Riccardo Stilli underscored the company’s focus in China in 2017.
Marni has been growing double digits to 170 million euros, or $187 million, with a strong increase in the accessories segment, in particular handbags. The first Marni Flower Café opened last year in the Hankyu department store in Osaka, inspired by the Marni Flower Market, first created to celebrate the 20th anniversary of the brand in 2014. Last year saw the arrival of new creative director Francesco Risso following the exit of Marni founder Consuelo Castiglioni. Stilli said that Risso’s collections, unveiled in January for men’s wear and in February for women’s wear, “have been generating interest in all key markets from the U.S. to Asia.”
Stilli underscored the strong success of Viktor&Rolf’s bridal line, launched last year, and “a second season already expected to double sales.” A retrospective has been set at the National Gallery of Victoria in Melbourne. The brand also continues to grow in its perfumes and eyewear categories.
OTB last year also took control of the Paula Cademartori accessories brand, which just opened a temporary pop-up store in Milan for three months to test a new distribution format.
Revenues at Staff International, which produces under licensing agreements Maison Margiela, Marni and Marc Jacobs’ men’s lines, as well as Dsquared2, Vivienne Westwood and Just Cavalli, totaled 390 million euros, or $429 million.
Brave Kid, which produces and distributes children’s wear for licensed brands Diesel, Dsquared2, John Galliano Kids and Marni, closed 2016 with sales of 40 million euros, or $44 million. Last year, it inked a license for the Trussardi Junior line.
“It was a complex year for Diesel,” said Stilli, impacted by the repositioning of the brand and its more selective distribution, which led to a “voluntary reduction” of sales totaling 200 million euros, or $220 million.
Diesel revenues totaled 960 million euros, or $1.05 billion, representing about 60 percent of total sales, but for the first time it operated at a loss, dented by business in Europe and the U.S., as well as in Hong Kong, said Stilli. “We are working on reorganizing activities, reviewing processes, the organization, and on being more flexible and fast.” The first two-and-a-half months of the year started well, he added, and online sales are posting double-digit growth.
Stilli underscored an acceleration in investments in the group’s digital channel and e-commerce in 2017.
Japan, with sales representing more than 20 percent of the total, and the U.S., were the group’s main markets.
As for a potential initial public offering, it’s not in the pipeline, said Stilli, although founder Renzo Rosso “has not ruled out a possibility if there is an opportunity.”