HDP NET FELL 43 PERCENT IN 1999

Byline: Luisa Zargani

MILAN — It was another rocky year for HdP.
Net losses at Valentino, GFT and Fila dented net income at Holding di Partecipazioni Industriali in 1999, dragging it down to $47.8 million from $83.9 million the year before. Dollar figures are translated from the lira at current exchange rates.
The group, whose holdings also include the publishing company Rizzoli Corriere della Sera, reported a drop in net revenues to $3.01 billion from $3.06 billion in 1998.
Net loss at Valentino came to $22.2 million, due chiefly to acquisition costs that were charged back to the Rome-based fashion house. In 1998, losses were $14.2 million.
Revenue at Valentino grew 6.3 percent to $75.7 million from $71.3 million in 1998. Last year, 58.4 percent of revenue came from royalties, 32 percent from boutique sales and 8.7 from haute couture. Accessories accounted for 1.8 percent.
HdP said it expects repositioned product lines and tighter production and distribution to boost Valentino’s performance in the second half of 2000.
GFT posted a net loss of $78.1 million, attributed to costs sustained by the company for the termination of the Emanuel-Emanual Ungaro bridge line and the reorganization of the group. Last year, GFT posted losses of $35.4 million.
As for GFT sales, HdP said that 1999 was negatively influenced by the termination of the Emanuel license, which contributed to a 7.3 percent drop in net sales to $642.6 million.
Meanwhile, GFT’s operating profits rose to $1.1 million from a loss of $22.4 million in 1998.
HdP’s future reorganization plans include the integration of Valentino under the GFT umbrella. In addition, GFT will now be called Gruppo Finanziario Tessile International Network SpA, or GFT Net.
As reported in these columns, beginning with the fall 2000 collection, the Giorgio Armani Collezioni women’s line will no longer be produced by GFT, although GFT will still distribute the collection in the U.S.
The HdP statement added that, based on the orders for 2000 and the positive impact of the company restructuring, HdP expects an improvement in overall operating profits.
On the upside, the RCS publishing division reported a 52.4 percent increase in profits to $88.1 million, up from $57.8 million in 1998. Revenues rose 8.1 percent to $1.48 billion from $1.37 billion the previous year. HdP said the rise in revenue growth was mainly due to an 11.1 increase in advertising sales. Operating profits rose 15.3 percent to $97.3 million, up from $84 million in 1998.

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