MILAN — Valentino’s growth shows no signs of slowing as the fashion house logged a 57 percent increase in earnings before interest, taxes, depreciation and amortization last year and a 36 percent gain in revenues — and this year, which will be marked by a couture show in the Italian capital in July, looks equally promising.
“If the market holds, in light of Valentino’s customer appeal and increased loyalty to the brand, we can expect another year of relevant growth rate,” said chief executive officer Stefano Sassi in an interview at the company’s offices here, ahead of the brand’s ready-to-wear show in Paris on Tuesday. “We have attracted new and different customers, but our base is increasingly more solid and we are growing in all categories around the world. There are all the ingredients for a good 2015.”
In 2014, EBITDA rose to 102 million euros, or $135.6 million, equal to 15.3 percent of sales. This compares with 65 million euros, or $85.8 million, in 2013.
Last year, revenues climbed to 664 million euros, or $883.1 million, from 488 million euros, or $644.1 million, in 2013. Operating profit rose to 50 million euros, or $66.5 million, compared with 36 million euros, or $47.5 million, in 2014. The company’s net profit had not been broken out at press time.
Dollar amounts are converted at average exchange for the period to which they refer.
Led by Sassi and under the creative direction of Maria Grazia Chiuri and Pierpaolo Piccioli, who have rejuvenated the brand and added their own signature romantic and whimsical style with an edgy touch, sales have more than doubled since 2010, when they totaled 274 million euros, or $361.6 million.
“The trend is very consistent and we’ve seen an acceleration in the past two years as the project matured,” said Sassi, crediting majority shareholder Mayhoola for Investments, which took control of Valentino in 2012, for full support in the global expansion of the brand. This has included the opening of stores around the world. Accessories and ready-to-wear last year accounted for 50 and 30 percent of sales, respectively. Men’s wear and the Red line contributed the remaining 20 percent.
Last year, key stores opened in New York and Hong Kong, while Valentino will open a sprawling flagship in Rome at the end of the month or in early April, followed by an official opening event on July 8 and a couture show this season only in Rome on July 9. Sassi said there is “symbolic value” to the two-day “Roman experience,” as a way to leave a mark on the city, where the brand was founded and is headquartered.
As with the other Valentino boutiques, the store in Rome is being designed by David Chipperfield, but the concept is adapted to the space, which spans across several palazzi near the Spanish Steps.
Globally, retail sales climbed 45 percent. Sassi said last year the company took control of distribution in Korea and the Middle East, through a partnership with Chalhoub Group in the latter case, and opened 30 stores. Sassi underscored that retail revenues grew on a like-for-like basis, too, and touted the company’s “retail efficiency,” and a 22 percent increase in sales per square meter. Stores around the world now total 160.
An additional 20 to 30 units will open in 2015, including a banner in London’s Bond Street. In the U.S., a unit in the Miami Design District opened in January; a store at the Royal Hawaiian in Waikiki will open in July, and a door at the Las Vegas Bellagio in December.
Asked how he views Valentino’s retail expansion at a time when several luxury competitors are reining in their openings, Sassi said Valentino started from a lower number of doors and was underpenetrated globally. “We needed the stores to increase our visibility,” the ceo said. Last year, retail accounted for 60 percent of sales.
Last year, “unexpectedly,” said Sassi, the highest sales growth was registered in Europe as much as in Asia. The U.S. showed a double-digit gain and Japan also grew.
Business in Russia did not slow down, but Sassi conceded that fewer Russians were traveling in the October to January period. However, February has “returned above the same month last year, up a few percentage points,” noted the executive.
Asked about the possibility of an initial public offering, Sassi said it was not in the cards for Valentino and that the company’s owners, backed by a private investor from Qatar, are thinking long-term.
Responding to the rumors that circulated earlier this year about Chiuri being considered for Gucci’s creative director and disagreements between the designer and Piccioli, Sassi said both “have a strong attachment and are fully committed to the Valentino project.” He contended that “each has a strong vision and is greatly talented. Their dialectical reasoning and opinions have always been channeled into an effective and compelling synthesis. We were less observed before, now, we attract more gossip,” he shrugged. “The job is not over yet — there is potential to grow and very well.”