Prada shrugs off slowdown concerns
Fin24 - Dec 7th 2012, 07:49
Hong Kong/Milan - Italian fashion house Prada SpA beat forecasts with a 30% rise in third-quarter net profit, shrugging off concerns about a slowdown in demand for luxury goods.
The Hong Kong-listed company, popular for its coloured Miu Miu dresses and leather handbags and shoes, has outperformed its sector so far, helped by its retail expansion in new markets.
"The group has continued to grow at a rate that has exceeded our expectations but great care has still been paid to cost control and working capital management," Patrizio Bertelli, chief executive, said in a statement.
The company, led by trend-setting designer Miuccia Prada and her husband Bertelli, posted a net profit of €122.1m in the third quarter, boosted by wealthy spenders from Asia and other emerging markets.
That compares with an average forecast from analysts polled by Reuters SmartEstimate of €110m and with €93.6m a year earlier.
Wealthy tourists from Asia and Russia have shielded the fashion house from a sluggish growth in Italy, being felt by domestic peers such as Tod's.
Milan-based Prada also says it still has plenty of room for growth because it has a limited presence in fast-growing markets including Asia, compared with rivals such as LVMH and Salvatore Ferragamo.
Prada shares have soared 80% so far this year, outperforming the benchmark Hang Seng Index which is up 21% over the same period.
Global sales of luxury goods are expected to grow 5% this year, stripping out currency effects, from 13% last year, according to a report by Bain and Italy's luxury goods trade body Altagamma
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