“In the first six months of the 2014, the group has operated in a more difficult political and macroeconomic environment than expected with unfavorable exchange rates and a general fall in consumption. Against this background, we have continued to focus our efforts on medium/long-term growth: our industrial, marketing and retail investments to sustain the quality of our products and our relationships with clients will continue to bear fruit, supporting the growth of the group on all markets. In the coming months, our priority commitment shall be towards monitoring market trends and performance without, however, interrupting the implementation of our plans for growth. At the same time, we will implement a rigorous cost control program with the aim of protecting margins”, commented Patrizio Bertelli, Chief Executive Officer of Prada S.p.A.

Performance in the first six months of the year was conditioned by unfavorable exchange rate trends and revenue at current prices was up by only 1%; if the currency fluctuation impact is removed then constant exchange rates revenues would have grown by 4%.

The trend in revenue performance differed from one geographical area to another. The Asia Pacific markets recorded overall revenue decline of 2% at current exchange rates (2% increase at constant exchange rates) with performance remaining weak in Korea, Hong Kong and Singapore, while China accelerated in second quarter, achieving 12% growth at constant exchange rates. The other Asian markets managed steady rates of growth. Japan again achieved another positive growth despite the expected slowdown in purchases after the VAT increase at the beginning of April (+19% at constant exchange rates and +10% at current exchange rates).

The positive trend in the Americas continues with the retail channel recording 8% growth at current exchange rates (+14% at constant exchange rates). By the other hand, revenue has fallen slightly in Europe, -1% both at constant and current exchange rates. The company attributes the downward trend to the fall in tourism and to the negative general economic environment which has hit domestic consumption.

The main brand in the group’s portfolio, Prada, had increasing revenue, growing by 5% at constant exchange rates while, at current exchange rates, there was growth of 1%. The development for the Miu Miu brand continues: +7% at constant exchange rates and +3% at current exchange rates. The brand continues to achieve high rates of growth on all markets, except Europe. Church’s and Car Shoe, also enjoyed positive revenue trends, with +14% and +2% variation at current exchange rates, respectively.

Analysing revenue by product category. Clothing and footwear performed extremely well with growth of 18% and 23%, respectively, at constant exchange rates (+14% and +19% at current exchange rates). Meanwhile, revenues from sales of leather goods decreased by 1% at constant exchange rates (-5% at current exchange rates) because of the fall in the number of tourists whose spending is more oriented towards this product category.

Prada S.p.A. and its subsidiaries are known as Prada Group, and are a global player in the design, production and distribution of luxury items, including leather goods, handbags, footwear, apparel, accessories, eyewear and fragrances. Its products are sold in 70 countries worldwide through a network of DOS stores and a selected network of luxury department stores, independent retailers and franchise stores.

For more information about Prada please visit the company’s website.