8 C
New York
Friday, February 23, 2024

Ermenegildo Zegna ZGN 2023 Gross sales Graze 2B Euros Up 27.6%

MILAN — The Ermenegildo Zegna Group closed 2023 on an upward trajectory, with gross sales grazing 2 billion euros.

Within the 12 months ended Dec. 31, positive factors throughout all markets, lifted specifically by North America and Higher China, helped drive group revenues up 27.6 p.c to north of 1.9 billion euros, in contrast with 1.5 billion euros in 2022, displaying an natural development price of 19.3 p.c. Figures reported on Wednesday have been preliminary, because the group will report full-year financials on April 5.

Within the fourth quarter, gross sales soared 40.1 p.c to 570 million euros, with an natural development of 19.6 p.c, accelerating from a 11.3 p.c acquire within the third quarter of 2023.

 “We’re shifting past being the undisputed primary chief in menswear,” mentioned chairman and chief government officer Gildo Zegna mentioned proudly throughout a convention name with analysts, citing the publicity to womenswear as additionally contributing to the positive factors.

 “The numerous improve in our revenues in 2023, and particularly from our community of immediately operated shops, is a transparent indication that demand for our manufacturers stays wholesome, and that we’re efficiently executing our technique to extend their desirability and solidify their place as leaders within the luxurious market,” continued the chief.

He highlighted the fixed enchancment within the Zegna model’s productiveness, “forward of plans by 50 p.c,”  proving the power of the group’s execution, “refined clienteling and CRM.”

Zegna has constructed a provide chain that he mentioned advantages all of the group’s manufacturers “and drives Zegna’s management in made-to-measure and product customization, which we’re targeted on additional enhancing with the introduction and ongoing rollout of Zegna X [digital customization tool] that’s empowering our type advisers to additional serve our prospects utilizing the most recent expertise.”

Whereas conscious of the present challenges, he expressed his confidence within the group’s consideration to value management and money safety.

In 2023, revenues for the Zegna section amounted to 1.32 billion euros, up 12.4 p.c in contrast with 2022, reporting an natural development price of 19.5 p.c.

Revenues for the fourth quarter totaled 385 million euros, up 15.2 p.c and with an natural development price of 18.2 p.c.

Luxurious leisurewear revenues carried out strongly, now making up round 50 p.c of the Zegna model’s revenues. Footwear continued to outperform, up excessive double-digits, representing 13 p.c of the product combine. Formal put on was “dynamic,” mentioned Zegna.

In 2023, gross sales of  Thom Browne rose 14.9 p.c to 380 million euros with an natural development price of 17.8 p.c. Revenues for the fourth quarter got here in at 99 million euros, up 30.2 p.c and with an natural development price of 24.6 p.c. The fourth quarter development mirrored the growth within the model’s direct-to-consumer channel, in addition to robust wholesale deliveries in comparison with the low base of the final quarter in 2022, which was as a result of a distinct timing of shipments throughout the course of 2022, when in comparison with 2023.

Chief monetary officer Gianluca Tagliabue mentioned the group is shifting away from seasonal into month-to-month drops.

Thom Browne Pre-Fall 2023

Thom Browne Pre-Fall 2023

Courtesy of Thom Browne

Since its consolidation on April 29 final yr, revenues for the Tom Ford Vogue section amounted to 236 million euros, of which 97 million euros have been reported within the fourth quarter of 2023, reflecting a robust efficiency throughout the vacation season.

Womenswear is outperforming, now making up 30 p.c of revenues.

Zegna reiterated that “Tom Ford Vogue ought to be one of many high 10 luxurious manufacturers globally.”

In November 2022, the Estée Lauder Cos. Inc. mentioned it was buying the Tom Ford model in a transaction valuing the corporate at $2.8 billion. As a part of the deal, the Zegna Group and Marcolin entered long-term licensing agreements for Tom Ford Vogue and Tom Ford eyewear, respectively. On Tuesday, Zegna renewed its licensing settlement with Marcolin for its eyewear, first launched in 2015 and which can now proceed by means of the tip of 2030.

Tom Ford RTW Spring 2024

Tom Ford RTW Spring 2024

Giovanni Giannoni/WWD

Continued development within the Europe, Center East and Africa area and the very robust efficiency within the U.S., pushed by robust double-digit retail Zegna gross sales, along with a rebound in Higher China, have been seen as “testaments to the soundness of our long-term technique,” mentioned the CEO, who stood by the group’s monetary objectives outlined for the medium time period throughout the Capital Markets Day in December in New York. These embody delivering over 10 p.c compounded annual revenues development and an adjusted working revenue CAGR of round 20 p.c, in contrast with 2023.

“That is anticipated to generate important money surplus even whereas bearing in mind increased, focused investments in advertising and marketing and capital expenditure to boost model desirability and drive development,” mentioned Zegna.

In 2023, gross sales in North America soared 41.6 p.c to 417 million euros. Within the fourth quarter, revenues jumped 60.1 p.c to 132 million euros, additionally supported by the consolidation of Tom Ford Vogue.

Within the yr, revenues from the U.S. totaled 385 million euros, up 42.3 p.c.

The chief mentioned that spending on the Zegna model within the U.S. nearly doubled pre-pandemic ranges, which he attributed to the rebranding technique and execution.

He remained optimistic on American shopper spending, “not solely within the States but additionally overseas, with beautiful numbers,” seeing no slowdown. Quite the opposite, there was an elevated retail efficiency within the U.S.

Revenues within the Europe, Center East and Africa area have been up 26.6 p.c to 659 million euros, lifted by each home spending and international customers.

The United Arab Emirates continued to outperform the remainder of the area, with gross sales of 69 million euros, a 35 p.c improve in contrast with the earlier yr.  

In 2023, gross sales within the Asia Pacific area amounted to 788 million euros, up 22.2 p.c. Of that, 596 million euros got here from Higher China, up 20.5 p.c on the earlier yr.

Requested to touch upon China, Zegna mentioned that it carried out higher within the final quarter than within the third quarter, reporting “new traction because of the Triple Sew sneakers, pulling new prospects in,” with out shedding the loyal ones.  

He mentioned he had not seen an incremental improve in Chinese language vacationers in Europe or the U.S. whereas they did improve in Japan and South East Asia. “There could also be an upswing [in Chinese tourists] within the second half however I’m nonetheless cautious for 2024,” he provided.

Japan additionally confirmed development, posting revenues of 85 million euros, up 29.9 p.c.

Gross sales in Latin America amounted to 38 million euros, a 25.6 p.c acquire.

Responding to an analyst’s query, Tagliabue mentioned he was “completely satisfied” with the group’s natural efficiency in November and December, which was higher than “a softer” October, ending the yr on a optimistic notice.

Group direct-to-consumer revenues amounted to 1.26 billion euros, up 37.8 p.c on 2022 and accounting for 66.4 p.c of the overall. Of that, 945 million euros got here in from Zegna-branded merchandise, up 22.4 p.c year-over-year, additionally lifted by the rise of 14 shops, reaching a complete of 253. There have been a number of additions of Zegna boutiques within the U.S., together with a unit in East Hampton, the Saks New York Fifth Avenue concession and 6 new Nordstrom openings. Shops additionally opened in Courchevel, St. Moritz, Kuwait Metropolis, Jinan and Wuhan.

Final yr the group  started immediately working the Zegna enterprise in South Korea. This concerned the conversion of the 16 Zegna shops within the area to direct-to-consumer factors of sale.

Tagliabue mentioned that DTC is anticipated to account for 75 p.c of group gross sales within the medium-term.

Revenues from Thom Browne on this channel amounted to 183 million, up 25.9 p.c, reflecting additionally the shift of the South Korean enterprise from wholesale to DTC.

Thom Browne added six shops, reaching a complete of 86. Openings have been primarily within the Asia Pacific area, in cities corresponding to Jinan and Wuhan, Shenzhen Bay, Nagoya, Kanagawa, and Tokyo Shinjuku. CEO Lelio Gavazza mentioned he was “notably completely satisfied” with the retail growth of the model. “We’re operating on monitor and preserve our plans,” he mentioned, additionally placing an accent on the equipment and womenswear classes.

Tom Ford Vogue contributed 136 million euros in DTC revenues since its consolidation. The model added 121 shops, of which 51 have been immediately operated with three openings for the reason that acquisition at Saks New York Fifth Avenue, Dubai and Abu Dhabi.

Group wholesale revenues for the complete yr 2023 amounted to 635 million euros, up 11.3 p.c. Of that, 164 million euros got here in from Zegna-branded merchandise, an 8.4 p.c acquire.

 Thom Browne wholesale revenues amounted to 195 million euros, up 5.8 p.c.

 Tom Ford Vogue wholesale revenues totaled 99 million euros.

Gross sales of the group’s textile product line amounted to 151 million euros, up 10.4 p.c  year-over-year and with an natural development price of 9.5 p.c.

Revenues for the third-party manufacturers product line have been 25 million euros, down 74.1 p.c, impacted by the tip of the distribution licensing settlement for Tom Ford Worldwide with the autumn 2022 season.

Related Articles


Please enter your comment!
Please enter your name here

Latest Articles