MILAN — Luxottica Group SpA posted another year of growth in 2016.
In the 12 months ended Dec. 31, the Italian eyewear company reported a 2.8 percent increase in revenues to 9.08 billion euros, or $9.98 billion. At constant exchange, sales rose 3.9 percent. Revenues in the fourth quarter accelerated, showing a 6.3 percent gain.
The wholesale division dropped 1.8 percent to 3.52 billion euros, or $3.87 billion, while the retail channel rose 6 percent to 5.55 billion euros, or $6.1 billion.
The company characterized the year 2016 as one of change as it simplified its organization, aligned prices across markets and enhanced its brand portfolio. During the year, the group also invested in its manufacturing and logistical infrastructure, supporting the entry into new markets and strengthening digital communications.
The group’s e-commerce platforms were up 24 percent at constant exchange. In particular, Ray-Ban, Oakley and Sunglass Hut showed a strong performance on their online stores.
“We are very pleased with the results of 2016, especially given that they were achieved in a year of major investments and initiatives to improve the quality of the company and we expect to report a higher net profit on a year-over-year adjusted basis,” said Leonardo del Vecchio, executive chairman. Together with Massimo Vian, chief executive officer of product and operations, the entrepreneur emphasized the acceleration in the last quarter, showing an improvement especially in North America. “The first few weeks of 2017 confirm the group’s prospects for healthy growth that we expect will accelerate during the year. The Luxottica of today is a stronger, simpler and more efficient company, with a faster decision-making process. We are preparing to take a major step forward in the realization of our vision: to offer a product that finds the reason for its success in the integration of frame and lenses.” This is a reference to Luxottica’s agreement to merge with Essilor of France announced earlier this month, which will create a $16 billion giant.
In addition to its own brands, Luxottica produces and distributes collections for brands ranging from Giorgio Armani and Chanel to Prada, Ralph Lauren, Valentino and Versace.
In the year, Luxottica sales in North America were up 0.8 percent to 5.37 billion euros, or $5.9 billion, driven by the retail segment and a strong performance of LensCrafters and Sunglass Hut.
Europe was up 4.3 percent to 1.7 billion euros, or $1.87 billion, lifted by the wholesale performance in Italy, the U.K., Spain and Eastern Europe, as well as by the retail division driven by Sunglass Hut, boosted by 100 new stores opening, including 57 stores in Galeries Lafayette.
The Asia-Pacific region was affected by the restructuring of its distribution network in Mainland China, which resulted in the withdrawal of goods from the marketplace in the fourth quarter for a value greater than 30 percent of quarterly sales. Although the Chinese market returned to positive growth in the first few weeks of 2017, said the company, last year’s restructuring resulted in a decrease of 1.7 percent to 1.15 billion euros, or $1.26 billion, in Asia-Pacific.
Southeast Asia, India and Japan confirmed solid growth for the year. The retail segment in Mainland China registered a strong increase in sales driven by the launch of new Ray-Ban stores (47 as of Dec. 31).
Latin America was up 1.6 percent to 552 million euros, or $607.2 million. Mexico remains among the fastest-growing countries for the group, and Brazil continued to generate growing sales in 2016 despite the current unfavorable economic situation.