Prada Observes Strong Start To 2022, But Uncertainty Looms
Prada is seeing a strong start to 2022 and it expects to meet its medium-term growth targets, although the war in Ukraine makes it hard to predict results.
The Italian fashion brand’s earnings before interest and taxes reached $535.85 million in 2021, up from $337.2 million in 2019, before the pandemic began. Its performance beat analysts’ estimates, which had expected earnings to reach $471 million.
Overall, the company’s operating profit was 14.5% of its total sales, which was significantly higher than 9.5% in 2019.
“Prada Group’s start to 2022 has been strong. Our long-term strategy is on track,” CEO Patrizio Bertelli said, adding that he is feeling confident about meeting medium-term targets, “even though it is difficult to predict the impact of the Ukraine conflict on the global economy.”
The brand’s growth came as it focused on reviving its online sales, which helped offset losses resulting from store closures around the globe. It also benefited from consumers’ desire to splurge on high-end purchases as they remained cooped up in their homes during the lockdowns.
Looking ahead, the company is bullish on its growth prospects, but uncertainty looms on its future as Russia’s attack on Ukraine stands to destabilize markets around the world.
Earlier this month, Prada announced that it had suspended its retail operations in Russia, following several other leading brands that are pulling out of the country.
Russia accounted for around 2% of Prada’s total sales in 2021, the company said.
Originally published at https://retailbum.com on March 15, 2022.
