Salvatore Ferragamo and Prada have started organizing “beauty contests” to select the banks that will handle their initial public offerings, largely expected to be held late in the Spring or early in the summer of next year.

Ferragamo seems to have made it a point of honor to be listed before its larger rival, and it may achieve its goal having the advantage of closing its financial year on Dec. 31, enabling it to present a complete set of annual figures to investors before Prada, whose financial year ends on Jan. 31.

Estimated to be worth €1.2-1.8 billion, Ferragamo will likely appoint its global coordinator for the IPO very soon, if it has not already done so. The Florence-based company expects to close 2007 with sales of €700 million, operating profit before amortization (EBITDA) of €100 million and net profits of €50 million, according to the weekly Il Mondo which cited the company’s business plan.

Sales are expected to rise to €750 million in 2008, to €820 million in 2009 and to €920 million in 2010, it added. EBITDA is forecast to rise to €120 million next year, to €150 million in 2009 and to €170 million in 2010, while net profits are seen at €60 million in 2008, €75 million in 2009 and €97 million in 2010. The EBITDA margin is expected to rise gradually from 14.3 percent this year to 18.5 percent in 2010.

Company data showed that in 2006 Ferragamo booked sales of €630 million, up 10 percent from 2005 at actual currency rates and up 12 percent at constant rates. Footwear represented 37 percent of total sales, bags and small leathergoods 31 percent, apparel 15 percent, accessories 10 percent, perfume 6 percent and other revenues 1 percent.

The group had 234 directly controlled stores at the end of last year, and they represented 63 percent of its sales. Wholesale represented 36 percent of sales and licenses 1 percent. On a regional basis, Europe and the USA took each 25 percent of sales, while Asia and Japan were equally tied at 23 percent each. Latin America had 3 percent of revenues and licenses 1 percent.

Ferragamo is about to open its 5th Russian store in Ekaterinburg, after two openings in Moscow.

Meanwhile Prada has invited 12 banks to compete as its global coordinator for the IPO. The company dismissed speculation that Goldman Sachs was the front-runner for the job, adding that no choice has been made and there is no favorite.

Prada has also been coy about the timing of the IPO, officially saying that there is no schedule. However, Gaetano Micciche, head of the corporate division at the bank Intesa Sanpaolo, which has a 5 percent stake in the Milan-based fashion group, said that Prada’s results are “so brilliant and comforting” that 2008 could be the right year for a Bourse listing. However, the decision rests in the hands of Prada’s board, along with Patrizio Bertelli, the group’s chief executive, and his wife, Miuccia Prada.

In 2002, Prada dropped plans for a stock exchange listing because of adverse market conditions. The global coordinators selected at the time were BNP Paribas, Deutsche Bank and Banca Intesa, which merged this year with Sanpaolo. The advisor was Morgan Stanley.

In September, Prada anticipated that it will beat an earlier target of €280.0 million for this year’s EBITDA. The group is estimated to be worth €4.5-5.0 billion.

The Milan-based fashion group continued to streamline its organization recently by absorbing a wholly-owned unit, Lamos, which produces 550,000 pairs of women’s shoes a year for the Prada brand at four Italian plants. The move is intended to boost the value of Prada’s industrial assets by incorporating them into the parent company while rationalizing the production process.

Prada’s shoe manufacturing operations also include Artisans Shoes for men’s. This subsidiary has two production sites in Italy and manufactures more than 300,000 pairs of shoes a year, while another 400,000 pairs of men’s shoes are produced by third-party suppliers. Prada also owns the UK shoemaker Church’s, which manufactures annually about 300,000 pairs in Northampton.