LONDON — Shares in Jimmy Choo Plc were down 2.6 percent to 1.71 pounds, or $2.52, in afternoon trading on Thursday even though the British brand reported a 9 percent uptick in net profit for the 2014 fiscal year.
The luxury footwear brand, which debuted on the London Stock Exchange in October, said adjusted consolidated net income rose 9 percent to 22.9 million pounds, or $37.8 million, on the back of a 6.5 percent increase in revenue to 299.7 million pounds, or $494.5 million, reported in January.
At constant exchange rates, revenue grew 12.2 percent. Adjusted earnings before interest and taxes were up 1.1 percent to 35.4 million pounds, or $58.1 million.
Dollar figures have been converted at average exchange rates for the 12 months to Dec. 31.
In a telephone interview, chief executive officer Pierre Denis said most of the year’s revenue growth came from Choo’s existing retail units as well as the nine new stores that opened during the 12-month period, more than half of them in China.
He said growth was spread evenly worldwide, with the Asia region — an underpenetrated market for Choo — notching a 34.5 percent rise, not including Japan. A more mature market for the brand, Japan posted a 30 percent uptick at constant exchange rates.
Europe remains the largest market for Choo, followed by the U.S., and both regions notched high single-digit growth in the 12 months to Dec. 31.
“This has been a year of great financial, strategic and operational progress for the company,” Denis said.
The fastest-growing product category was men’s, including the men’s fragrance Jimmy Choo Man, and Denis added Choo.08 degrees, a new seasonal collection of boots, flat shoes and sneakers, was also a big driver of growth.
Asked about the impact of the strong pound, Denis said Choo saw “significant headwinds,” which he said would accelerate this year. Negative currency fluctuations averaged 5.8 percent globally.
He added the company “has not yet taken any final position on pricing,” following moves by Chanel earlier this week to align its prices worldwide as the euro dips in value against the dollar, pound and yuan. “I think we’re all looking right now at what to do,” Denis said.
He also noted Russians — and in particular the traveling shopper — have “disappeared from the shopping scene. And that will have an impact on our sales in 2015 for sure.” He added the traveling Chinese would offset the disappearance of the Russians.
Overall costs in the period climbed 5.1 percent, due in part to a rise in selling and distribution expenses and new store openings, and the initial public offering in October. Overheads, meanwhile, fell by nearly one percentage point due to greater controls.
Looking ahead, the brand said it plans to pursue its strategy of rolling out 10- to 15 directly-operated stores each year, with a focus on China, and renovating a similar number of stores with the new shop concept designed by David Collins Studio and already installed at the London and Beverly Hills flagships.