MILAN — Sluggish sales in Asia-Pacific, a weakened U.S. market penalized by the strong dollar and a lackluster market for leather goods affected Prada SpA’s profitability in the first nine months of the year.
The Italian luxury group saw its net earnings in the period ended Oct. 31 drop 26.3 percent to 235.1 million euros, or $261 million, compared with 319.3 million euros, or $427.8 million, in the same prior-year period.
Lifted entirely by the performance of its directly operated stores, company revenues rose 1.2 percent to 2.58 billion euros, or $2.86 billion, compared with 2.55 billion euros, or $3.41 billion, last year.
Dollar figures were converted at average exchange rates for the period in question.
“Over the last few months, we have seen a general worsening of the macroeconomic environment: in particular, continuing volatility on financial markets and rising fears on the social and political landscape have made consumers less willing to spend and decreased tourist flows in some countries,” said Prada chief executive officer Patrizio Bertelli. “Against this background and also in light of the far-reaching changes underway in the luxury-goods segment, we are further stepping up all our commercial and product-related initiatives to strengthen relations with our increasingly sophisticated and demanding customer base. At the same time, we have implemented further cost-containment measures following a review of all business processes.”
“In the medium-term, we remain optimistic about the outlook for the segment and confident that the undoubted stylistic leadership of our brands and our positioning — with global coverage already secured by our extensive retail network — will be key factors in facing up successfully to future challenges,” he added.