Prada Revenues Rise Despite Struggles in Americas

People walk past a Prada store in Brussels, Belgium September 5, 2023. (Reuters)
People walk past a Prada store in Brussels, Belgium September 5, 2023. (Reuters)
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Prada Revenues Rise Despite Struggles in Americas

People walk past a Prada store in Brussels, Belgium September 5, 2023. (Reuters)
People walk past a Prada store in Brussels, Belgium September 5, 2023. (Reuters)

Italian fashion group Prada reported a 10% rise in third quarter revenues on Tuesday as a strong performance in Asia and Europe helped to compensate for weakness in the Americas.

The revenue growth came in just ahead of analysts' expectations of a 9.3% rise, according to a consensus cited by Jefferies.

For the first nine months of the year net revenues totaled 3.34 billion euros ($3.6 billion), up 17% at constant exchange rates, with the ready-to-wear category showing the fastest growth and the Miu Miu brand also expanding rapidly.

"We continue to see positive momentum in the business and strong excitement around our brands, positioning us well for Q4 and vis-à-vis our ambition to deliver solid, sustainable, and above-market growth in 2023," Chief Executive Andrea Guerra said.

Guerra told a subsequent conference call that he was also happy with the way October had gone, noting that November and December were more important months for business.

Prada's rivals in the luxury sector such as Kering, owner of the Gucci brand, have also been hit by slowing demand for fashion and accessories, particularly in the United States and Europe.

The Americas region was a weak spot for Prada where retail sales fell 1.3% over the nine months, offset by double digit growth in the Asia Pacific, Japan and European markets.

Guerra said Prada and Miu Miu had raised prices by 4-6% this year and that trend was likely to be similar in 2024.

He added the company was aware of tensions in major cities in recent weeks linked to the conflict between Hamas and Israel but that had not translated into a major impact on business.

"For sure, in some cities of the world, in the past weeks we have seen a little bit more tension driven by macro, geo-political happenings. But I would say that so far we have not seen basic differences," he said.

Prada, whose brands also include classic English shoemaker Church's, is listed on the Hong Kong stock market and released its figures after the market closed on Tuesday.



Hermes 2Q Sales Rise 13% on Continued Appetite for High-End Luxury

People stand with Hermes shopping bags as they wait at a traffic light in Tsim Sha Tsui, a bustling shopping hotspot, in Hong Kong, China December 5, 2023. (Reuters)
People stand with Hermes shopping bags as they wait at a traffic light in Tsim Sha Tsui, a bustling shopping hotspot, in Hong Kong, China December 5, 2023. (Reuters)
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Hermes 2Q Sales Rise 13% on Continued Appetite for High-End Luxury

People stand with Hermes shopping bags as they wait at a traffic light in Tsim Sha Tsui, a bustling shopping hotspot, in Hong Kong, China December 5, 2023. (Reuters)
People stand with Hermes shopping bags as they wait at a traffic light in Tsim Sha Tsui, a bustling shopping hotspot, in Hong Kong, China December 5, 2023. (Reuters)

Birkin-bag maker Hermes reported a 13% rise in second-quarter sales on Thursday, demonstrating the continued appetite from wealthy shoppers for its luxury handbags, even as less affluent consumers pull back.

Sales at the French luxury group grew to 3.7 billion euros ($4.02 billion), a 13% organic sales rise that strips out currency fluctuations. The figure was in line with analyst expectations, according to a Visible Alpha consensus.

Operating profit for the first half was 3.1 billion euros, compared to a forecast from consensus provider Visible Alpha for 3.2 billion.

One of the most steady performers in the luxury goods sector -- even as economic conditions worsen -- the French group's results stand out after a string of disappointing earnings updates from peers which have raised investor concern about uncertain prospects for the sector in the coming months.

Hermes' famously classic designs and tight management of production and stock have helped reinforce the label's aura of exclusivity, and CEO Axel Dumas told reporters the company had seen "no big interruption in trends".

However, he said Hermes was seeing slightly less traffic with aspirational clients, which was impacting higher volume products like fashion accessories.