The accountants have pulled the curtain back at Versace — the 9 million-plus euros it has paid annually for fashion shows and events, the more than 5 million euros for photo shoots and more.
When Capri Holdings Ltd., also parent to Michael Kors and Jimmy Choo, bought Versace for $2.1 billion last year, the luxury brand morphed from being controlled by the Versace family to being part of a publicly owned holding company. The deal has been described exhaustively in mandated filings to the Securities and Exchange Commission and, on Friday, Capri disclosed the audited financial statements of GIVI Holding SpA, which held the 80 percent of Versace held by the family.
The financial statements shine a light on the inner workings of the brand from 2015 to 2017.
What is revealed is a designer business that spends a lot on image, gets the lion’s share of its revenues from its own stores and clearly has opportunity to grow in the U.S. — none of that is unexpected, but the specifics bring to light new information around one of the industry’s most prominent names.
Of the company’s 668 million euros in sales in 2017, 64 percent, or 427.9 million euros, came from its directly operated stores. And it was ready-to-wear (including Atelier) that pulled in most of those brick-and-mortar sales, with a tally of 220.7 million euros. Accessories generated another 185.9 million euros.
And Versace, like other designer brands, shines in Asia. The brand’s stores in the Asia-Pacific region drove sales of 213.4 million euros, followed by the Europe, Middle East and Africa division, with sales of 120.9 million euros.
The firm’s U.S. stores generated just 83.3 million euros — a figure the company’s new owner is looking to boost as overall sales are targeted to hit $2 billion over time.
All that consumer interest and buzz costs money, though.
The filings showed that in 2017, the company spent 21.5 million euros on advertising and promotion, 9.3 million euros on fashion shows and events and 5.6 million euros on photo shoots.
And while fashion brands are famous for their spending on shows and to get their names in front of shoppers, their biggest expenses are more mundane. The company spent 128.9 million euros on leases and rentals,121.7 million euros on outsourced manufacturing and 29 million euros on freight, customs and ancillary charges — not as glitzy, but still very still necessary to an international fashion house.