Nov 13, 2013
Cashmere specialist Cucinelli optimistic on sales growth
Nov 13, 2013
MILAN, Italy - Italian cashmere specialist Brunello Cucinelli said on Tuesday he expected growth in sales and earnings at his namesake company for the rest of this year and for the next two years, supported by demand for high-quality luxury clothing.
The process of gathering orders for next year's spring-summer collection went very well, Cucinelli said, supporting the positive outlook.
Cucinelli, which makes luxury clothes in a medieval hamlet in the Umbria region of central Italy, said net sales rose 14 percent year-on-year to 251.7 million euros ($338.22 million) to the end of the third quarter.
Revenue for the first nine months grew fastest in the United States, at a rate of 26.4 percent, followed by Europe at 19.2 percent. The United States is the world's biggest luxury market this year, according to consultancy Bain & Co.
In Italy, where over 20 percent of sales are generated, revenues fell 2.6 percent.
Cucinelli said his objective for his home market was to end 2013 flat to the previous year and to start to pick up in 2014.
"Looking at the orders we have taken for next year's spring-summer collection, you see that things are getting better again," Cucinelli told Reuters, referring to Italy.
Sales in Greater China rose 16.7 percent. Cucinelli said Asian tourists continued to flock to Europe to make their purchases of "absolute luxury" clothes and accessories.
"It (China) is a market we pay a lot of attention to but for me the most important markets of reference have to be Europe and America first." North America and Europe each make up around 30 percent of total sales.
"These new buyers come to visit us in Europe," Cucinelli said. "It's easy to imagine that it's quite chic to go shopping in London, Paris or Milan."
Luxury brands such as Hermes and Giorgio Armani have ventured into products like perfume to take advantage of their highly-recognisable brands. But Cucinelli said his firm, which makes around 85 percent of its revenue from clothing, will continue to focus on that.
"We could certainly imagine perfumes and eyewear but we still prefer to do the craft we know," Cucinelli said.
The company agreed to buy a men's tailoring business based in Tuscany this year, giving it the opportunity to develop an area Cucinelli believes has growth potential.
"Lots of young guys who are 27, 28, 30, have never had a suit, but the desire is there to go back to wearing suits," Cucinelli said. "This is a great opportunity."
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