MILAN — Add the Moncler Group to the luxury companies that are weathering the challenging macroeconomic, social and political challenges.
In the nine months ended Sept. 30, the group reported revenues of 1.8 billion euros, a 16 percent increase compared with 1.55 billion euros in the same period last year. Admittedly, the third quarter was impacted by a slowdown, as sales rose 7 percent at constant exchange rates to 669.7 million euros.
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“I am very pleased with the results achieved during the third quarter of the year, when both the Moncler and the Stone Island brands delivered robust double-digit growth in the core direct-to-consumer channel, despite a continuously volatile operating environment,” said chairman and chief executive officer Remo Ruffini. “This proves the strength of both our brands and reflects the deep connection we have built with our customers and our communities all around the globe. As we approach the most important part of the year, we remain vigilant in light of the ongoing macroeconomic uncertainties, but at the same time confident in the solidity of our brands and of our clear strategic vision.”
Sales of the Moncler brand in nine months rose 19 percent to 1.49 billion euros and Stone Island reported a 2 percent gain to 310.1 million euros, reflecting a change in business model from wholesale to direct-to-consumer.
During a call with analysts on Thursday evening at the end of trading, Luciano Santel, chief corporate and supply officer, and Elena Mariani, strategic planning and investor relations director, were repeatedly asked about the performance of the different clusters of customers in the main markets. Santel admitted there had been a slowdown starting in the second half of September and in October after a strong July and August performance, especially in Europe and the U.S., also in light of the challenging comparisons with the same period last year. Asia was performing well, they said, citing Hong Kong for example. Any kind of prediction was premature, though, noted Santel.
In the third quarter, revenues for Moncler amounted to 561.2 million euros, up 9 percent at constant exchange rate, normalizing compared to the growth recorded in the second quarter, which benefited from a more favorable comparable base, particularly in Asia.
In Asia, which includes Asia Pacific, Japan and Korea, nine-month revenues of Moncler grew by 29 percent to 705.3 million euros, representing 47.1 percent of the total. Japan and Korea continued to report a very solid performance in the third quarter, despite a slight normalization.
In the Europe, Middle East and Africa region, Moncler revenues grew by 18 percent to 573.2 million euros, representing 38.3 percent of the total. In the third quarter, the increase stood at 6 percent at constant exchange rate, sequentially slowing due to a normalization in local consumption and a slower recovery of tourism flows compared to the first part of the year. Chinese, Korean and American customers remained the strongest contributors to tourist purchases in the region.
The Americas were flat at 217.8 million euros, representing 14.6 percent of the total, mainly due to the conversions of Nordstrom and part of Saks from a wholesale model to concessions. The DTC channel continued to record strong double-digit growth in the third quarter, accelerating compared to the previous quarter.
Asked about the quiet luxury trend, Santel said that the group has long offered the Moncler Edit collection for those customers who like “more classic” products, “elegant with very rich materials, and this is doing very well,” and responding to a question about lagging aspirational customers, he said he did not see a deterioration. “We want to elevate the level of the collection; Moncler is not impacted by the slowdown of the aspirational customer,” he pointed out.
In the first nine months of 2023, Moncler’s DTC channel recorded revenues of 1.15 billion euros, up 28 percent. Revenues in the third quarter of 2023 increased by 18 percent at constant exchange rates, supported by strong double-digit growth in Asia and the Americas, while EMEA normalized. The growth of the DTC channel in the third quarter was also affected by a deterioration in the performance of the direct online channel, particularly in the EMEA region.
The wholesale channel recorded revenues of 343.3 million euros in the nine months, a decline of 2 percent compared with the same period last year. In the third quarter, revenues in this channel declined by 9 percent at constant exchange, mainly impacted by the conversions of Nordstrom and part of Saks in the U.S., in line with the ongoing efforts to upgrade the quality of the distribution network. The performance of the wholesale channel in EMEA and Asia remained solid in the quarter.
As of Sept. 30, the network of Moncler directly operated boutiques comprised 262 units, a net increase of five compared with the end of June, including Shanghai Pudong Airport and the conversions of Paris CDG Airport T1 and S4. The Moncler brand also operated 59 wholesale shops-in-shop.
The Moncler Genius collaboration with Palm Angels launched Thursday; coming up next is one with Rick Owens. Asked about the collaboration with Pharrell Williams, who attended the presentation of the collection last September, in light of his contract with Louis Vuitton as creative director of menswear, Santel said that the artist has been “very close to the brand and to Remo Ruffini,” ever since 2009. “It’s a strong friendship they have and it’s the main reason he was open and very willing to participate to the event,” said Santel. “If potentially there could be other opportunities to work together, we would be very happy to continue to do so.”
Genius contributes to increase new and existing audiences, showing newness with innovation, explained Santel. Asked about a potential collaboration fatigue for customers, Santel said that Genius is working on co-creation now and that, for example, the recent Adidas collection “has been very successful.”
Santel told analysts to expect strong commercial activities and “impactful events” for Moncler Grenoble in December and in the first two months of the next year. “Grenoble is a pillar of our business, a heritage brand.”
Speaking of Stone Island, Santel said he believed 2024 will still be “a transitional year” for the brand, which will see the implementation of the development strategy set in motion since the group’s acquisition in 2020. “A moderate midsingle-digit growth rate, but to the benefit of the brand” should be expected, with a decline in wholesale sales in line with the plan, “cleaning up the market.” The idea is to enhance the visibility of the brand, without any urge to open too many stores. “We don’t want to force customers to buy more than what they need, and we want to grow organically,” he said.
Asked about former Gucci executive and Stone Island CEO Robert Triefus, who was appointed to the role last June, Santel said he is “actively working on the brand. He has a brand strategy background,” a key “reason why he is on board.”
As reported in September, Stone Island has inked a two-year global partnership with Frieze, signaling a new phase for the Italian brand, which staged an immersive archival exhibition in South Korea to coincide with the second edition of Frieze Seoul. These are “intended to increase the level of awareness. The perception of the brand is strong but it still needs a lot of development,” said Santel, adding that in mid-2024 the company plans to insource its online business, which is now operated under a deal with the Yoox Net-a-porter group.
In the nine months, Stone Island recorded revenues of 225 million euros in the EMEA region, an increase of 3 percent compared with the same period last year. In the third quarter, revenues were in line with the same period of the previous year, with strong double-digit performance in the DTC channel entirely offsetting the decline in the wholesale channel.
Asia reached sales of 57.8 million euros in the nine months, growing 10 percent. In the third quarter, the region grew by 1 percent with the strong performance of Japan compensating for the weak performance of the Korean market.
The Americas were down 19 percent to 27.2 million euros compared with the first nine months last year. In the third quarter the region saw a decline of 2 percent as performance continued to be impacted by softer business trends and a more cautious approach from department stores as a result.
The wholesale channel was down 5 percent to 202.1 million euros in the first nine months of 2023. In the third quarter, revenues declined by 6 percent year-on-year primarily due to the strict volume control adopted in the management of this channel to continuously improve the quality of the distribution network.
The DTC channel grew by 18 percent to 107.9 million euros in the nine months, representing 35 percent of the total. In the third quarter, revenues in this channel were up 16 percent, mainly driven by the very solid performance of EMEA and Japan.
As of Sept. 30, there were 77 directly operated Stone Island stores, an increase of three units compared to the end of June, including Chengdu Swire and Rome La Rinascente. The Stone Island brand also operated 19 monobrand wholesale stores, in line with the last quarter.
The board on Thursday appointed Mariolina Piccinini, chief marketing and corporate strategy officer, as manager with strategic responsibilities of Moncler SpA and member of the company’s Strategic Committee.
Piccinini has developed her professional expertise in the fields of communications, sustainability, and reputation management at Ferrari, Fiat and Ferrero, among others. She joined Moncler in 2015 as sustainability director.
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