Prada braces for a tough year ahead after coronavirus outbreak wreaks havoc in China and home market Italy
- Net profit of €255.7 million for 2019 beats analysts’ estimates of €255.2 million
- Months of anti-government protests in Hong Kong caused sales to fall by 1.7 per cent in Asia-Pacific, the most in the world
Italian luxury brand Prada Group’s outlook is negative for the year ahead, blindsided by the outbreak of coronavirus, despite posting better-than-expected results for 2019.
The fashion house said on Wednesday that it had a “very positive” start to the year until the coronavirus outbreak erupted in China, one of its key markets, before later spreading to its home market of Italy.
“Although it is difficult to forecast the evolution of the epidemic, we are expecting a negative impact on this year’s results and we are implementing a comprehensive contingency plan to mitigate it, relying on our flexible supply chain and lean organisation,” said chief executive Patrizio Bertelli, in a filing to the Hong Kong stock exchange, without giving figures.
On Monday, the company announced that Bertelli, his co-CEO Miuccia Prada, and chairman Carlo Mazzi, had donated six intensive care and resuscitation units to three hospitals in Milan, including a children’s hospital. They joined a number of fashion labels who have recently donated millions to treat those affected, and help prevent the spread of the virus.
Net profit for the Hong Kong-listed designer – which owns brands including Miu Miu and Church’s – was €255.7 million (US$279.5 million) for 2019, up 7.9 per cent compared to the previous year, and coming slightly above estimates of €255.2 million by analysts polled by Bloomberg.
Revenue was €3.23 billion, up 3 per cent compared to 2018, and higher than the estimated €3.21 billion, or 2.3 per cent gain.
