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Prada reports strong first half results

Prada reports strong first half results

The economic recovery in the luxury sector is well underway, as once again proven by the brand of Prada. Prada saw its sales increase by 66% at constant exchange rates in the first half of the year, exceeding market expectations.

 

The Prada group said on Thursday that its turnover reached 1.5 billion euros, while analysts were expecting 1.43 billion euros, according to a Refinitiv consensus.

 

However, these latest results for the year 2021 are still a little below the pre-pandemic results for the year 2019. Recall that during 2020, companies were hit hard by the Covid-19 pandemic and its restrictions.

 

A rebound driven by China and e-commerce

 

These financial results were driven by China as the country eased health restrictions related to the global Covid-19 pandemic. Asia and the US also contributed by exceeding pre-pandemic levels, while Europe‘s figures are still 29% lower than 2019.

 

“Once shops reopened, (sales) partially recovered,” said Prada, adding that strong demand from local customers partially offset the lack of tourists to the region.

 

Another effect is that e-commerce has jumped by 100% compared to the previous year and online sales now account for 7% of retail turnover.

 

Thanks to a full-price sales policy and strict cost control, earnings before interest and taxes (EBIT) became positive at 166 million euros, compared to a loss of 196 million euros last year, still linked to the global health crisis.

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Patrizio Bertelli, CEO of the Prada group said that “Sales momentum will remain strong in the second half of the year” adding that “The group will hold a financial markets day in the autumn rankhaya.com.”

 

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Featured Photo : © Reuters

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