Prada Group net income down as Prada and Miu Miu struggle in 2016
In the fiscal year closed at the end of January 2017, the Prada Group's net income lost 15.9%, falling to €278.3 million. Preliminary results published in February put the group's revenue at €3.184 billion, down 10% (-9% excluding exchange rate effects), and consolidated figures now tell the story of a negative performance by both the Prada and Miu Miu labels.
Prada sales were worth €2.5 billion, equivalent to a 10% shortfall on a yearly basis, with a weak performance in the second half of the year and some "resilience" towards the end of the fiscal period, according to the group. As for Miu Miu, its revenue of €515 million marks an 8% decline over the previous year, with a better sales performance in the second half of the year and the last quarter in particular. British footwear label Church's enjoyed a brighter year, thanks to a 6% increase in sales, though the brand remains a minor element in the group's business, its sales being worth €80 million.
The group's consolidated results also offer an insight on sales by product type. Leather accessories, at €1.8 billion, represented 57.5% of sales but lost 14%, in a year that saw the segment's price range broaden. Footwear, worth €679 million, lost 4%, despite a very strong showing by Miu Miu. Ready-to-wear fashion was relatively stable at -1% with €600 million, and the group underlined how the Prada and Miu Miu collections were well-received.
"The Prada group's results for 2016 are altogether satisfactory and consistent with market expectations, in a tough transition year for the corporation, said CEO Patrizio Bertelli. We have added a wealth of products distinctive for their innovative style and features to our range, while we have also streamlined our cost structure across all business segments. Our retail strategy has evolved from geographical expansion to the rationalisation and digitalisation of the network. We have introduced several new store concepts in order to improve the customers' experience, and the initial results are encouraging."
On the style side, Prada announced a few days ago its first catwalk show dedicated to the cruise collection, to be held on 7th May at Milan's Osservatorio, an 800 m2 venue inaugurated last December by the Prada Foundation on the roof of the Galleria Vittorio Emanuele II shopping mall in the heart of the city, dedicated to photography and the visual arts.
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