|Fashionable Chinese can't get enough of Prada's bags|
The Italian fashion house hasn't felt much of the worsening debt crisis in Europe thanks mostly to mainland Chinese shoppers, according to deputy chairman Carlo Mazzi.
After the annual general meeting yesterday he said: "If you knew the results from our first quarter, perhaps you would also be optimistic."
The first quarter results will be out on June 7, and HSBC is bullish about Prada's prospects.
That's because according to the Italian fashion brand's report released yesterday, high demand for Prada's leather goods, particularly in China, have pushed its earnings up by 23.3 percent to 3.15 billion euros (HK$31.3 billion) this year, and the net profit could increase 72.2 percent to 431.9 million euros.
While hardly anyone in Greece buys Prada goods, its possible exit from the euro zone could impact its European neighbours and thus affect the Italian fashion house.
That's why Prada has strategically turned to emerging countries like Morocco and Dubai to open shops, as well as 12 to 15 boutiques in China this year.
Mazza added he didn't want to raise prices in Europe as there was already high shipping costs and import taxes into many Asian countries as well as an appreciating renminbi. He ruled out cutting prices as well unless governments reduced luxury taxes in developing countries.
CLSA Asia-Pacific Markets released a report earlier that found more than half of the sales for certain luxury brands including Gucci and Prada in key European cities, New York and Hong Kong were made by mainland visitors.
It just goes to show the mainland Chinese love of all things Italian will continue for a while yet, and thankfully for them Italy is still coping financially -- for now.