Net profit increased by 23.8 percent to €66.1 million at Tod’s in 2006, while earnings before interest and taxes (EBIT) climbed by 26.2 percent to €113.7 million. The good margins were attributed by the Italian company to lower costs, a more efficient production chain and strong performances in Asia.
Last year Tod’s opened five directly operated stores, bringing the number up to 110, and 16 franchises – mostly in Asia, bringing their number up to 63. The company expects to open about 10 more directly operated stores, and a similar number of franchises, in 2007.
As previously reported, the company has sales of €573.0 million in 2006, up 13.9 percent, partly thanks to the group’s ongoing expansion in Asian countries. The management is expecting a similar increase of between 10-13 percent in 2007 and is confident about its growth potential in Asia’s emerging markets and in the USA. Sales so far this year have been «very strong» and the Fall/Winter collections have been positively received.
Tod’s made investments of €30.5 million in 2006, as compared to €21.4 million in 2005. Most of the budget was spent on refurbishing stores, on relocating and expanding the New York and Hong Kong offices, and on a new leather goods plant in Tuscany.
Sales of Tod’s branded items increased by 13.1 percent to €326.4 million in 2006. Hogan’s, which is diversifying into clothing, went up by 23.3 percent to €155.5 million, while Fay’s sales rose by 6.8 percent to €82.4 million. Sales of the Roger Vivier brand licensed by Diego Della Valle and his brother soared by 69.7 percent to €6.5 million.
Across the different brands, shoes led the way, with sales up by 13.6 percent to €357.5 million. Sales of leather goods and accessories rose by 19.4 percent to €133.5 million, apparel sales were up by 7.4 percent to €80.9 million, and sales of other products rose by 2.5 percent to €1.1 million.
Sales in Italy rose by 15.8 percent to €279.6 million. Internationally, sales increased by 8.2 percent to €145.4 million in the rest of Europe, by 5.2 percent to €60.0 million in North America, and by 25.3 percent to €88.0 million in Asia and the rest of the world.
Retail-wise, sales went up by 9.4 percent to €283.2 million at directly operated stores, and by 18.7 percent to €289.8 million at franchises and other stores. On a comparable basis, sales at directly operated stores were up by 8.1 percent. The last two months of the year were particularly strong, after an increase of 6.6 percent for the rest of the year.