Prada H1 revenue drops 40 percent following store closures

Prada saw its revenue drop 40 percent at constant exchange rates to 938 million euros in the first half of the year as global store closures took their toll on the Italian luxury label.

For the six months to 30 June, the group swung to a 180 million euro loss compared to profits of 155 million euros in the same period last year.

The company was hit particularly hard by international lockdowns. Retail sales were down 32 percent while wholesale sales plummeted 71 percent. In terms of retail sales, all regions were impacted by store closures, with the Middle East (-44 percent), Americas (-42 percent), and Europe (-41 percent) hit hardest, though Japan (-39 percent) and Asia Pacific (-39 percent) also registered double-digit declines.

'Signs of recovery' as stores reopen

However, the company said it has seen “signs of recovery in consumer spending in all geographical areas”, with strong double-digit sales growth in Mainland China since April.

Additionally, the group said its e-commerce direct channel has performed positively in all regions, achieving triple-digit growth even since lockdowns have been lifted.

Patrizio Bertelli, Prada Group CEO, commented: “I am very proud of the commitment and sense of responsibility demonstrated in these circumstances by all our people. The first half of 2020 saw a temporary interruption of our growth trajectory which, in a situation of progressive control of the pandemic, we are confident will gradually resume from the second half of 2020, when our store network will again be fully operational.

“The excellent response of local consumers after the re-openings, confirms the desirability of our products and the strong relationship with our customers, which has been further strengthened by our continued focus on digital technology. The recent positive trends in all markets, combined with our solid balance sheet and financial position, allow us to look to the future with confidence today.”

Photo credit: Prada