MILAN (Reuters) – Italian luxury group Prada on Tuesday reported 21% growth in operating profit last year, in line with analysts’ forecasts, amid speculation about a potential acquisition of smaller rival Versace.
The group, which has been defying a slowdown in luxury demand and outperforming many of its peers, reported a 17% increase at constant exchange rates in net revenues in 2024, reaching 5.43 billion euros ($5.72 billion) and matching analysts’ expectations, according to data from LSEG.
Bloomberg News reported on Sunday that Prada is moving closer to a deal for Versace after agreeing to pay nearly 1.5 billion euros ($1.6 billion) for the business founded by the late Gianni Versace in the 1970s, where his sister Donatella has been the creative head for more than two decades.
Italian newspaper Corriere della Sera reported on Tuesday that Prada is interested in the acquisition of both Jimmy Choo and Versace from Capri Holdings for a total outlay of between 1.5 billion euros and 2 billion euros.
The statement made no mention of the reports of a potential Versace deal and Chief Financial Officer Andrea Bonini said, “we don’t comment on rumours” when asked on a conference call about links to Versace and Jimmy Choo.
Revenues grew by double figures across all regions, with the exception of the Americas region, which reported a 9% growth thanks to an improvement in the second half of the year.
The Asia Pacific region saw a good performance over the year, with 13% growth, with an improvement in the last quarter across all main areas.
In the fourth quarter itself, retail sales, which account for most of the total sales, rose 18%, thanks mainly to the smaller Miu Miu brand. Growth at Prada’s main brand was more moderate, around 4% year-on-year in the period.
“Looking forward, while being mindful that the complex industry dynamics are likely to persist, our priorities remain unchanged,” said Chief Executive Andrea Guerra.
“At Prada, we have a clear opportunity to continue to drive market share, while at Miu Miu we shall consolidate its success,” he added.
The group had a net cash position of 600 million euros at the end of December, which could help to fund a potential acquisition.
($1 = 0.9485 euros)
(Reporting by Elisa Anzolin; Editing by Keith Weir)
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