It can be said that 2023 was an extremely successful year for the Italian fashion conglomerate Prada, judging by their financial report. The entire credit goes to the famous designers who continuously captured the hearts of fashion enthusiasts for the Prada and Miu Miu brands. Yesterday, the company announced that they could achieve a significant increase in revenue and income similar to 2023 in this year.
Summary of Content: Despite strong growth in all other regions worldwide, market share in the US sharply declined. However, Prada still faces challenges of recession in the global luxury goods industry. Prada inks JV with SSI to expand presence in the Philippines.
According to the financial report, the consolidated revenue of the Prada Group last year reached just under 4.73 billion euros. This corresponds to a 13% increase compared to 2022. However, after adjusting for exchange rates, the growth rate reached 17%.
In the retail sector of the group, revenue increased by 12% to 4.19 billion euros, particularly driven by business operations from the Miu Miu label (+58%). In the wholesale business sector, revenue increased by 12% to 433 million euros. Profit from licensing activities increased by 36% to 104 million euros.
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Despite robust growth in revenue, the gross profit margin also increased, contributing to a 37% improvement in pre-tax and interest profit (EBIT) to 1.06 billion euros. And this figure exceeded the previous year’s level by 26%. Net profit attributable to shareholders also increased by 44%, reaching 671 million euros.
However, Prada still faces challenges of recession in the global luxury goods industry. Miu Miu’s viral micro miniskirt is dividing fashionistas The micro miniskirt is one of the “hot items” that once stirred the fashion community. For this event, analyst Robyn Duffy of RSM UK shared that although sales of luxury goods had declined, demand for craftsmanship and quality had driven strong profit growth in Asia and Japan. Duffy further noted that Miu Miu has benefited from “viral social media products and star-studded fashion shows and collaborations with other brands” that have captured the minds of young consumers.
Duffy continued: “The new direction in business operations since CEO Andrea Guerra joined has changed. They are more focused on short-term priorities such as product innovation, events, and a stronger digital footprint. And the smarter long-term strategies are the acquisition of Prada’s store on Fifth Avenue in New York, which has strengthened the brand’s presence at one of the most prime and coveted real estate locations in the world.”
Prada To Buy Manhattan Building Housing Its Flagship Store for $425 Million Prada has bought back the Manhattan building for $425 million to build its first store on Fifth Avenue, New York. “2024 presents some challenges for the luxury goods sector. Specifically, trends such as stable tourism returning in the US and Europe, cost-of-living pressures affecting consumer sentiment, and the yet-to-be-fulfilled spending potential of China. But Prada has positioned itself very well to withstand current pressures and seems ready to enter the upcoming financial year.”
