Federico Marchetti

MILAN — The Yoox Net-a-porter Group on Monday released what is expected to be its last set of figures as a separate public company. As reported, Compagnie Financière Richemont SA’s move to take over all of the e-tailer is almost complete after the vast majority of YNAP shareholders agreed to sell to the luxury giant, and the intention is to delist YNAP from the Milan Stock Exchange. Shareholders will be paid on May 18, the same day Richemont plans to publish its annual results.

In the three months ended March 31, YNAP revenues inched up 0.5 percent to 518 million euros, compared with 515 million euros in the same period last year. At constant exchange rates, sales grew 7.9 percent.

Chief executive officer Federico Marchetti said he was “very pleased” with the performance, showing, at constant exchange rates, a 14 percent increase at the group’s in-season channel and a 22 percent gain at the online flagship stores. “Hard luxury, which we introduced in 2016, is performing tremendously well this year. In April, we created the first dedicated online destination for fine jewelry and luxury watches on Net-a-porter,” Marchetti said. “Soon we’ll be launching a companion hub on Mr Porter. With our deep understanding of luxury customers worldwide, we will continue to invest in long-term initiatives that ensure YNAP’s continued global leadership.”

While additional details were not available on Monday as the group did not hold a conference call with analysts and the press, YNAP stated that it expected to “achieve organic net revenue growth in line with its strategic plan” in fiscal year 2018, in light of its “leadership position in luxury fashion e-commerce and of the positive outlook for the online retail market, lifted by all the business lines and key markets. The group also expects to deliver an improvement in the adjusted EBITDA margin at constant exchange rates.”

In the first quarter of 2018, the multibrand in-season business line, which includes Net-a-porter and Mr Porter, gained 5.9 percent to 282.3 million euros. At constant exchange, revenues increased 14.1 percent. The division accounted for 54.6 percent of total sales. In the period, the channel expanded its stable of luxury brands, including Balenciaga and Fendi FF capsules. Mr Porter launched an exclusive capsule with Prada, the brand’s first such online project for men’s wear. Net-a-porter also created the new Fine Jewelry & Watch Suite and Mr Porter partnered with Cartier to launch a selection of new Santos de Cartier timepieces and unveiled one exclusive version of six new Bell & Ross limited-edition BR-X1 Skeleton Tourbillon Sapphire watches.

The multibrand off-season line, which includes Yoox and The Outnet, registered sales of 183.3 million euros, down 4.6 percent, and accounting for 35.4 percent of the total. At constant exchange rate, sales gained 2 percent. “This performance reflects the decrease in The Outnet customer retention rate mainly due to low product availability in the fourth quarter, as well as the impact of a pricing strategy designed to mitigate the severe currency headwinds on Yoox,” the company said. This division also expanded with the addition of the See by Chloé and Polo Ralph Lauren pop-up stores. In April, The Outnet launched in the Middle East and Japan.

The online flagship stores business line, which manages banners for brands ranging from Giorgio Armani to Valentino, recorded organic gross merchandise value growth of 21.8 percent. Taking into account the negative net perimeter effect resulting from discontinuations and additions, sales at this business line totaled 51.9 million euros, down 7.4 percent, and representing 10 percent of revenues. At constant exchange, sales decreased 1.5 percent. In the quarter, the Ferrari site launched in Europe, the U.S. and the Asia-Pacific region including China. In February, the existing partnership with Armani was further extended: specifically, the A|X Armani Exchange brand, previously active in North America and Europe, was extended to Japan.

At constant currency, the group reported growth in all its key markets. In the U.K., sales rose 3.2 percent to 68.8 million euros. At constant exchange, revenues grew 5.9 percent.

In North America, the group’s main market, revenues fell 5.1 percent to 153 million euros, reflecting the sharp depreciation of the euro. At constant exchange, sales increased 8.5 percent.

Revenues in Italy increased 10.4 percent to 34.6 million euros. First-quarter sales in Europe, excluding Italy and the U.K., increased 2.3 percent to 137.6 million euros.

The Asia-Pacific region confirmed positive momentum, as revenues grew 2.5 percent to 93.4 million euros. At constant exchange, they gained 13.4 percent. The performance was mainly driven by Hong Kong and Japan.

The Rest of the World area inched up 0.6 percent to 30.1 million euros. At constant exchange, sales climbed 4.9 percent.

In 2018, YNAP plans to invest between 170 million to 180 million euros, mainly channeled into technology and improve free cash flow absorption compared with 2017, and to expand its operations with the opening of a new in-season hub in Milan and additional spaces at the Interporto logistics pole in Bologna.

Richemont said last week that the minimum 90 percent threshold for its public tender offer had been fulfilled, and that it has secured 94.99 percent of Yoox Net-a-porter Group SpA’s ordinary shares.

In January, Richemont launched a voluntary tender offer for all ordinary shares of the Yoox Net-a-porter Group SpA at 38 euros a share, for a value of up to 2.77 billion euros. Richemont’s plan was to acquire 51 percent of the YNAP shares it did not already own, valuing YNAP at about 5.3 billion euros.


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