LUXOTTICA GROUP Third quarter net sales grow by 3.5%2, driven by retail and e-commerce
• Luxottica Group's net sales in the third quarter were Euro 2,215 million: +3.5% at constant exchange rates2 and +2.9% at current exchange rates
o Wholesale division's net sales were Euro 732 million: +0.9% at constant exchange rates2 and -1.0% at current exchange rates
o Retail division's net sales were Euro 1,483 million: +4.8% at constant exchange rates2 and +4.9% at current exchange rates
• Luxottica Group's net sales in the first nine months of the year were Euro 6,767 million: +1.3% at constant exchange rates2 and -4.5% at current exchange rates
o Wholesale division's net sales were Euro 2,463 million: -2.4% at constant exchange rates2 and -7.2% at current exchange rates
o Retail division's net sales were Euro 4,305 million: +3.5% at constant exchange rates2 and -2.9% at current exchange rates
• Outlook confirmed for 2018
Milan (Italy), October 22, 2018 - The Board of Directors of Luxottica Group S.p.A. (MTA: LUX), a leader in the design, manufacture, distribution and sale of fashion, luxury and sports eyewear, met today to review the consolidated net sales for the third quarter and the nine months ended September 30, 2018, in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board.
Net sales in the third quarter of 20181
(Millions of Euro) | 3Q 2017 |
restated4 | |
Group net sales | 2,153 |
Wholesale division | 739 |
Retail division | 1,414 |
3Q 2018 | Change at constant | Change at current | ||
exchange rates2 | exchange rates | |||
2,215 | +3.5% | +2.9% | ||
732 | +0.9% | -1.0% | ||
1,483 | +4.8% | +4.9% | ||
(Millions of Euro) | 9M 2017 | 9M 2018 | Change at constant | Change at current |
restated4 | exchange rates2 | exchange rates | ||
Group net sales | 7,085 | 6,767 | +1.3% | -4.5% |
Wholesale division | 2,654 | 2,463 | -2.4% | -7.2% |
Retail division | 4,431 | 4,305 | +3.5% | -2.9% |
Net sales of the first nine month of 20181
Luxottica's net sales in the third quarter of 2018 were up 3.5% at constant exchange rates2, thanks to the strong performance of the Retail division and e-commerce platforms as well as solid growth in Europe, North America and Asia-Pacific. The positive results were driven by a combined increase in the average unit price and volumes, and by an acceleration of sales of key brands. The performance improvement in both divisions allowed the Group to close the first nine months of the year with sales up 1.3% at constant exchange rates2, growing profitability and strong free cash flow generation.
The wholesale net sales in the third quarter were up 0.9% at constant exchange rates2 (-1.0% at current exchange rates) led by the positive performance in North America and the strong improvement in Europe. During the summer, Europe recovered after a delayed start of the sun season.
The retail sales accelerated compared to the first six months of the year with comparable store sales3 up 2.8% and net sales up 4.8% at constant exchange rates2 (+4.9% at current exchange rates). This confirms the effectiveness of strategic initiatives aimed at improving the operating model and the ability of the Group's retail brands to execute them. Europe and North America drove Sunglass Hut sales, up 8% at constant exchange rates2. Positive sales were also driven by LensCrafters in North America, OPSM in Australia and Ray-Ban stores all over the world.
In the third quarter, sales from the Group's e-commerce platforms were up by 16% at constant exchange rates2. Ray-Ban.com confirmed it is the main driver of the Group's online business, benefiting from the exclusive launch of special collections and the brand-new campaign for Ray-Ban Studios, which strengthens the link between the brand, music and millennials. SunglassHut.com and Oakley.com contributed to the excellent performance of the online business as well.
"We're very pleased with the growing results posted in key countries and across all channels in this quarter. We are keeping a good balance between growth and profitability as further proof of the fact that global strategies and quality of execution are delivering the results we expected. A special thanks goes to all the over 80,000 employees of Luxottica who, in this complex journey towards the creation of EssilorLuxottica, have always shown me full confidence, maintaining their passion and the attachment to our Group" stated Leonardo Del Vecchio, Executive Chairman of Luxottica.
"The strategic renewal that the Group undertook over the last three years strengthened the vertically integrated business model and favored organizational simplification, increasing decision-making speed and execution precision. The excellent results are a solid basis for carrying out the integration with Essilor."
"In light of the positive trend in the retail and e-commerce businesses and the return to growth of the Wholesale division, we confirm the outlook for 2018, with expected sales growth around 2%2 and solid profitability."
Luxottica and Essilor on October 1, 2018 announced the creation ofEssilorLuxottica,a global leader in the design, manufacture and distribution of ophthalmic lenses, prescription frames and sunglasses.
Geographic segments: net sales1
Net sales (millions of Euro) 3Q 2017 restated4 % 3Q 2018 %Change at constant exchange rates2 Change at current exchange rates North America 1,236
+3.5% +2.9% |
Net sales | 9M 2017 | % | 9M 2018 | % | Change at constant | Change at current |
(millions of Euro) | restated4 | exchange rates2 | exchange rates | |||
North America | 4,045 | 57% | 3,866 | 57% | +2.4% | -4.4% |
Wholesale division | 741 | 10% | 714 | 10% | +3.2% | -3.5% |
Retail division | 3,305 | 47% | 3,152 | 47% | +2.2% | -4.6% |
Europe | 1,602 | 23% | 1,546 | 23% | -1.9% | -3.5% |
Asia-Pacific | 870 | 12% | 853 | 12% | +4.0% | -2.0% |
Latin America | 436 | 6% | 389 | 6% | +1.2% | -10.8% |
Rest of the World | 131 | 2% | 113 | 2% | -10.6% | -14.2% |
Group total | 7,085 | 100% | 6,767 | 100% | +1.3% | -4.5% |
North America - In the third quarter, the Group's revenues in North America were up 3.7% at constant exchange rates2, thanks to the solid growth recorded by both divisions.
wholesale sales increased by 3.9% at constant exchange rates2 with the positive contribution of all sales channels and, in particular, of key accounts, independent eyecare professionals and the sport channel.
The Retail division's excellent results, with sales up 3.6% at constant exchange rates2, are driven by all retail brands, with the exception of Sears Optical. Sunglass Hut continues to be the top destination for consumers for premium eyewear, also thanks to an increasingly omnichannel offering. LensCrafters is continuing the process of transforming its business model, with very satisfying results: revenues grew by 2.7% at constant exchange rates2 and the comparable stores sales3 returned positive to +2.3%.
Europe - In the third quarter, the Group's net sales in Europe grew by 4% at constant exchange rates2, driven by the excellent performance recorded in France, the United Kingdom, Turkey and Eastern Europe and the double-digit growth of the retail business. The Wholesale division showed a recovery compared to the first part of the year, when commercial policies realignment and the delay of the sun season led to a temporary slowdown in sales in the region. Improvements were also registered in Mediterranean Europe.
Asia-Pacific - In the third quarter, the Group's net sales in the Asia-Pacific region showed an increase in sales at constant exchange rates2 of 5.3%. Every market in the region contributed to growth, with the exception of Taiwan, which was temporarily affected by the upcoming opening of a commercial subsidiary.
Performance in Australia confirmed the strength of OPSM and Sunglass Hut. At the same time Japan, Korea and Southeast Asia, strategic markets for the Group, recorded an acceleration of growth.
Latin America - After years of solid growth, the Group's net sales in Latin America reported a slight decline of -1.2% at constant exchange rates2, with the contraction of the wholesale business in Brazil, because of political and macro challenging environment. On the other hand, Mexico and the retail chains in Brazil and the rest of the region continued to register positive performances.
§
The officer responsible for preparing the Company's financial reports, Stefano Grassi, declares, pursuant to Article 154-bis, Section 2 of the Consolidated Law on Finance, that the accounting information contained in this press release is consistent with the data in the supporting documents, books of accounts and other accounting records.
Contacts
Alessandra Senici
Group Investor Relations and Corporate Communications Director Tel.: +39 (02) 8633 4870
Email:InvestorRelations@luxottica.comhttp://www.luxottica.com/en/investors/contacts
Marco Catalani
Group Corporate and Interlal Communications Director Tel.: +39 (02) 8633 4470
Email:marco.catalani@luxottica.com
Notes to the press release
1 Comparisons, including percentage changes, are between the three and nine-month periods ended September 30,
2018 and 2017.
2 Figures at constant exchange rates have been calculated using the average exchange rates in effect for the corresponding period in the previous year. For further information, please refer to the attached tables.
3 "Comps" or "comparable store sales" reflect the change in sales from one period to another that, for comparison purposes, includes in the calculation only stores open in the more recent period that also were open during the comparable prior period, and applies to both periods the average exchange rate for the prior period and the same geographic area. Comparable store sales do not include e-commerce sales.
4 See the first table in the accompanying Appendix.
Luxottica Group S.p.A.
Luxottica is a leader in the design, manufacture and distribution of fashion, luxury and sports eyewear. Its portfolio includes proprietary brands such as Ray-Ban, Oakley, Vogue Eyewear, Persol, Oliver Peoples and Alain Mikli, as well as licensed brands including Giorgio Armani, Burberry, Bulgari, Chanel, Coach, Dolce&Gabbana, Ferrari, Michael Kors,Prada, Ralph Lauren, Tiffany & Co., Valentino and Versace. The Group's global wholesale distribution network covers more than 150 countries and is complemented by an extensive retail network of approximately 9,000 stores, with LensCrafters and Pearle Vision in North America, OPSM and LensCrafters in Asia-Pacific, GMO and Óticas Carol in Latin America, Salmoiraghi & Viganò in Italy and Sunglass Hut worldwide. In 2017, with approximately 85,000 employees, Luxottica posted net sales of over Euro 9 billion. Additional information on the Group is available atwww.luxottica.com.
Important information
This press release does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States or any other jurisdiction. Securities may not be offered or sold in the United States unless they have been registered under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"), or are exempt from registration. The securities that may be offered in any transaction have not been and will not be registered under the U.S. Securities Act and Essilor does not intend to make a public offering of any such securities in the United States.
This press release is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (iii) high net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as "relevant persons"). The securities which are referred to herein are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.
Safe Harbor Statement
Certain statements in this press release may constitute "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Such statements involve risks, uncertainties and other factors that could cause actual results to differ materially from those which are anticipated. Such risks and uncertainties include, but are not limited to, the ability to manage the effects of the current uncertain international economic outlook, the ability to successfully acquire and integrate new businesses, the ability to predict future economic conditions and changes to consumer preferences, the ability to successfully introduce and market new products, the ability to maintain an efficient distribution network, the ability to set and achieve our business objectives and manage growth, the ability to negotiate and maintain favorable license agreements, the availability of correction alternatives to prescription eyeglasses, fluctuations in exchange rates, changes in local conditions, the ability to protect intellectual property, the ability to maintain relationships with those hosting our stores, any failure of information technology, inventory and other asset-related risks, credit risk on our accounts, insurance risks, changes in tax laws as well as other political, economic, legal and technological factors and other risks and uncertainties described in Luxottica Group's regulatory filings. These forward-looking statements are made as of the date hereof, and we do not assume any obligation to update them.
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Luxottica Group S.p.A. published this content on 22 October 2018 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 22 October 2018 16:02:11 UTC
