Contributor
May 11, 2023
In the first quarter, China re-emerged as a growth engine, driving a strong rebound in sales in the Asia-Pacific region.
Prada, an Italian luxury group listed in Hong Kong, China, released key financial data for the first quarter of fiscal year 2023 as of March 31: Although the macroeconomic environment is still full of uncertainties, net income still grew steadily by 22% to 1.065 billion euros; Retail sales increased by 22% year-on-year to 953 million euros, of which the Asia-Pacific region benefited from the recovery of the Chinese market, and retail sales rebounded strongly in the first quarter, up 22% year-on-year.
Patrizio Bertelli, Chairman and Executive Director of the Group, commented "We delivered solid growth in the first quarter across all categories and geographies as we continued to build on the attractiveness of our brands. The global environment in which we operate remains complex and changing, but our strategic priorities are clear, our organization is stronger, and the group is still responding positively."
The new CEO, Andrea Guerra, added, "Prada Group started this year well. In the first quarter, China became the growth engine again, driving a strong rebound in sales in the Asia-Pacific region. Our priority this year remains to improve store productivity and focus on retail execution."
On the second day after the financial report was released, as of the close on May 12, Prada Group’s share price rose by 2.45% compared with the previous trading day, and its current market value was approximately HK$144.318 billion. Since the beginning of this year, the group's share price has risen by 27.89%.
In terms of business categories, leather goods grew by 14% at constant exchange rates, driven by a combination of new products and iconic products; Ready-to-wear remained the fastest-growing category (+38%); With continued success, footwear retail sales also grew by a strong 20%.
Brand-wise, following the critically acclaimed Autumn/Winter 2023 menswear and womenswear shows, Prada continued to leverage its strong brand appeal with several successful campaigns during the quarter, including a dedicated retail showcasing the 'Eternal Gold' fine jewelry collection. New additions to the leather goods collection continue, including new additions to iconic collections of bags such as "Moon", "Galleria" and "Re-Nylon". Recently, Prada opened a new coffee space, Prada Caffè, in Harrods, London, attracting a large number of tourists to check in.
The highly successful Miu Miu Fall/Winter 2023 fashion show, the launch of the Spring/Summer 2023 advertising campaign starring Emma Corrin and Kendall Jenner, and the enthusiastic response to the second release of the "New Balance for Miu Miu" sneakers further enhanced Miu Miu's reputation. Brand momentum and awareness In addition, Miu Miu continues to successfully develop its leather goods business with the launch of the new "Pocket" collection of handbags.
From a market perspective, retail sales in the Asia-Pacific region rebounded strongly in the first quarter, up 22% year-on-year. The Chinese market accelerated again toward the end of the quarter. In addition, the group's business in Southeast Asia also continued to grow steadily.
Driven by tourism and local consumption, the European region maintained strong growth momentum in the first quarter, maintaining double-digit growth of 28%.
Growth in the Americas region was more moderate in the first quarter (+5%), mainly due to a challengingly high comparison base in the same period last year.
Retail sales in Japan increased by 55% year-on-year, mainly due to the group's recent investment in retail networks, strong domestic demand, and growing tourist traffic.
The Middle East region posted solid growth (+15%), albeit at a slower pace compared to the previous quarter.
