Prada says H1 net profit up 74%

Prada says H1 net profit up 74%

Hong Kong: Italian fashion house Prada posted a 74% rise in first-half profit, beating the forecast in its June listing prospectus, and said it would stick to its plan for opening new stores.

“We are continuing exactly what we planned in terms of investments, particularly new openings of shops," deputy chairman Carlo Mazzi told Reuters in a telephone interview.

“We are in the luxury goods markets and not in the mid-market. Usually this segment of the market is less hit by the crisis," he said on Monday.

Milan-based Prada, a maker of luxury bags and Miu Miu dresses, said group net profit totalled €180 million ($246 million) in the six months to end-July, compared with a forecast for €151 million in its listing prospectus.

Prada, which listed in Hong Kong on 24 June at HK$39.50, said turnover rose 21% to €1.134 billion .

Its stock ended down 3.7% at HK$41.30 on Monday, compared with a 2.8 % fall by the Hang Seng Index .

Prada and shareholders Prada Holding BV and Intesa Sanpaolo SpA sold 423 million shares in the June offering, raising HK$16.7 billion ($2.14 billion).

It raised an additional HK$2.5 billion after the joint bookrunners for its Hong Kong listing exercised an over-allotment option.

Prada had said in its listing prospectus it planned to add about 80 directly operated retail outlets in its financial year to January, of which 25 stores would be in Asia-Pacific. It had 319 directly operated outlets as the end of January.

Investors flocked to the flotations of Prada in Hong Kong and upmarket Italian shoemaker Salvatore Ferragamo in Milan in June, encouraged by their growing exposure to the higher-margin retail business in Asia.

Salvatore Ferragamo posted a one third rise in first-half profit in August, adding to evidence the luxury industry remained vigorous despite global financial turmoil.

Rivals PPR , LVMH Moet Hennessy Louis Vuitton and Burberry reported record results last month.