MILAN — Designer brands contributed to OTB’s growth last year, but one-off tax charges and currency fluctuations dented the group’s 2017 profits and revenues, while operating profit and net financial position spiked.
In the 12 months ended Dec. 31, OTB net profit dropped 21 percent to three million euros from 3.8 million euros in the previous year. The bottom line was affected by one-off tax charges of approximately seven million euros due to regulation changes in the U.S. and Japan.
Earnings before interests and taxes more than quadrupled, climbing to 21.5 million euros from 5.1 million euros in 2016.
Revenues were down 3.8 percent to 1.52 billion euros, compared with 1.58 billion euros in 2016, affected by currency fluctuations. At constant exchange rates, sales decreased 2.4 percent.
“We are implementing a series of initiatives aimed at improving efficiency and effectiveness across the entire group, in order to consolidate and develop each company in an organic way,” said Ubaldo Minelli, who was appointed chief executive officer of OTB in January, succeeding Riccardo Stilli, who exited that role after four years.
“We will continue to create value through business models that satisfy all stakeholders, and to invest in product excellence, distribution efficiency, and innovation in services,” Minelli added.
The net financial position reached 84 million euros, growing by 92 million euros compared to 2016.
OTB is in the process of reorganizing its structure, and Diesel in particular has been reviewing its activities and distribution. The parent company did not provide a breakdown of sales by brand.
Following Marni founder Consuelo Castiglioni’s exit in 2016, her successor, creative director Francesco Risso, has been putting his own stamp on the label, which the company said “is enjoying a high level of brand desirability, driven by its renewed offerings in women’s and men’s ready-to-wear, while gaining momentum in its accessories.” The project of lifestyle pieces and accessories “Marni Market” has helped increase the label’s global visibility and sales, “thanks to its product exclusivity and traditional craftsmanship.”
Maison Margiela, designed by John Galliano, who joined the brand in 2014, is benefiting from an omnichannel strategy and mapping out further growth, with the inclusion of licenses. The company pointed to the two recent exhibitions dedicated to the Belgian designer, who left his namesake company in 2009, and is the subject of a retrospective at the Palais Galliera, the fashion museum of Paris, and an exhibit focused on his work as artistic director of women’s rtw at Hermès at Les Arts Décoratifs after debuting last year at the MoMu Fashion Museum in Antwerp.
For Viktor & Rolf, 2017 “was marked by strong partnerships that have opened new market opportunities,” the company said. The brand launched a “Soir” line of special occasion attire last year, and its “Bridal” and “Evening” collections have been expanding internationally.
Paula Cademartori, known for her collection of whimsy handbags, has been developing a footwear offer. The company has recently tested retailing with two pop-up stores in Milan.
Staff International, which produces collections under licensing agreements for Just Cavalli, Dsquared2, Vivienne Westwood, Marni Uomo and Margiela’s MM6 line, introduced a new division for shoes and bags. Brave Kid produces children’s and junior lines for Diesel, Dsquared2, Marni, Trussardi and John Galliano.
Diesel, which in 2016 contributed to around 60 percent of OTB sales, has been focusing on product and communication, streamlining its activities, and optimizing its distribution network. At the end of last year, Diesel and Nicola Formichetti parted ways after a four-year collaboration. Diesel founder Renzo Rosso, who is president of OTB, said at the time that he was not naming a successor to the artistic director. “I believe this kind of company can work differently, and not in this same kind of direction. There are many things coming up, special projects. The market is very different now. We want to be modern, I want to explore,” Rosso explained then.
Changes were also made at the executive level, as Rosso tapped Marco Agnolin as Diesel’s new ceo, effective last January. Agnolin joined the company from a seven-year stint at Bershka, controlled by Spanish retail giant Inditex. He succeeded Alessandro Bogliolo, who left for Tiffany & Co. in October.