Coronavirus: Prada recovers from worst of Covid-induced slump, thanks to Asia
Prada SpA returned to profit in the second half of 2020 amid a recovery in Asia, joining other luxury brands in bouncing back from the worst of a pandemic-induced slump. Earnings before interest and taxes will turn positive in the last six months of last year after a deficit in the first half, the Italian fashion company said in a statement Tuesday.
Prada has been focused on reducing its sales via wholesalers in order to better control handbag pricing of handbags under its flagship and Miu Miu labels. Its own outlets now account for 90% of overall sales. The company is also ending seasonal discounts in a bid to boost its aura of exclusivity and profit margins.
Luxury brands found it hard at the start of the pandemic to slash spending as fast as revenue slumped because of their heavy fixed costs. Retail sales fell on average 6% at constant exchange rates in the second half, with Europe bearing the brunt because of a lack of tourists. The Asia-Pacific region, meanwhile, outperformed thanks to China.
(This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed. )