Prada Spa Ord

Good afternoon, everyone, and thank you for joining the Prada Group's nine-month 2023 revenue update. I'm delighted to be with you again, and with me today is our Group CEO, Andrea Guerra. We will start with some opening remarks and then move to Q&A. Before we start, please be reminded that during today's call, we may discuss forward-looking statements which are subject to risks, uncertainties, and factors beyond our control, and the actual outcome and returns may differ materially from such statements. Please refer to the disclaimer included in the slide two of our presentation. With that, I will hand over to Andrea Guerra.

Welcome, everybody. So we have... finished this first nine months of the year with a group of solid results, both in terms of brand desirability and business performance. Until when the two things will go together, we will be happy. For sure, this quarter was the toughest quarter for us in terms of comparison, and I think that we have achieved a little bit more as well of what we were thinking to achieve considering that at the end of the nine months for the group in the two years like for like is 51% so it really means that whatever happened we have been able to trail our journey without bumps what is good about all this period is how well received where both our shows mu mu on one side and proud on the other side in september october really reflecting a strong brand and creative momentum on both sides all the regions of the world have shown growth most of them double digit growth japan asia pacific europe doing more than average for all quarters i would highlight europe again with with a single digit almost high single digit in q3 again against probably one of the best quarter ever a year ago uh good growth of the chinese cluster uh on the comparison to 2022, but also in acceleration comparing to 2021, so a two-year stack, with a visible growth of Chinese traveler transactions. North American cluster is just a few drops down, but on the two years, I would always remember that it's plus 57%. Moving to Prada specifically, I would say that if we look at on a two years like for like, which is the measurement that I always prefer to look at, basically the rhythm in Q3 was similar to all our quarters. And if we compare only full price retail Prada was basically double digit very close to be double digit as well in this quarter we could have been maybe we have been a little bit soft on inventory for it for a period of three four weeks and probably we could have done a better job but I mean you're never you're never perfect we've been leaving this period celebrating and interpreting products codes and cultural identity shows very well received and again Prada was put as the cultural natural carver of the industry and last season This past season, really, we have been going through a very strong season supported by a lovely artistic cultural campaign night in conversation with the flower. Many things have happened for Prada in the business, in the geographies, with the products, with events, with the Prada Mode events, with the launch of the beauty category, Great Response, and the announcement of the partnership with Axiom lunar spacesuits so all of these things is only to give you an idea of the great health of the brand if we move to the different page which is mu mu again another quarter in the nine months is basically a plus 50% on last year and it's complicated when you have such a performance to go and highlight specific items or specific things which have been successful. Brand desirability, a range of great activities and events, great product momentum, and team is doing great. Obviously, when you're doing this kind of performance is the time when you have to be humble, no complacencies, and keep your journey straightforward. I think that these are the main remarks on the group, main remarks on Prada, main remarks on Miu Miu, and please, Andrea, take it from here.

Thank you, Andrea. Starting with net revenues by channel, total, the group recorded net revenues of Euro 3.344 billion in the first nine months of the year, up 17% against the same period last year at constant effects. This was driven by high quality retail growth throughout the period with a positive contribution from both average price and full price volumes. In the third quarter, retail sales were up by a solid 10%, notwithstanding the toughest phases of comparison of the year. On wholesale, we kept our approach selective with independence while we continued to see sustained growth in the DFS channel. On royalties, the business delivered strong growth of 67% in Q3, continuing to enjoy strong demand for both eyewear and fragrances. Exchange rates had a negative impact on group revenue of around four percentage points during the first nine months. Turning to the next slide, retail sales by brand. Prada delivered plus 13% growth in the nine months, driven by full price like-for-like sales. Q3, at plus 5%, continued to show a positive performance with a more moderate but solid pace compared to H1 due to the very challenging basis of comparison, particularly in Europe. MiuMiu delivers outstanding growth in the nine months at plus 49%, including in Q3, plus 48%. well spread across regions and categories. The brand contribution on group retail sales increased to 15 percent against 12 percent in the same period of last year. Moving to the next slide, retail sales by geography. Asia Pacific progressed well over the first nine months at plus 21 percent on a volatile basis of comparison. as 2022 saw significant disruption in Q2 and Q4. Growth continued to be double-digit in Q3, despite tougher comps, with Hong Kong and Macau continuing to deliver the highest growth. Europe grew by plus 17% in the nine months, supported by healthy local demand and high level of tourism. Q3 performance remained positive year on year at plus 6%, with solid underlying demand albeit moderated on very challenging comms as expected. In the Americas, we ended the nine months substantially flat with a mild sequential improvement in Q3 versus Q2. Japan continued to deliver outstanding growth with plus 42% in Q3, benefiting from strong local demand and increasing tourist flows. And lastly, the Middle East also delivered a solid performance at plus 12% in the nine months, albeit in slight moderation in the last quarter. Moving to retail sales by product, all product categories maintained growth in the third quarter with ready-to-wear continuing to lead at plus 25% in Q3 and plus 32% in the nine months. So very, very strong reception of the collections that continues. Leather goods was up plus 1% in Q3 and plus 8% in the nine months. And we continue to focus on icons, building on the success of Galleria's campaign at Prada and on Wonder and Arcadia at Miu Miu, but also newness. Lastly, footwear delivered plus 10% in Q3 and plus 16% in the nine months, with broad-based growth across formal, sneaker, and lifestyle collections. And with that, I will hand back to Andrea Guerra for some closing remarks.