Capri Holdings, the New York-based group it controls Versace, Jimmy Choo e Michael Kors expects to achieve a turnover of 8 billion dollars in the near future and has plans to invest 300 million dollars a year. In particular he wants to acquire a new luxury brand, preferably in Europe, with high potential, with a historical heritage and a turnover of around 500 million dollars.
It emerged during theInvestor Day, in which the fashion house took stock of its transformation into a luxury group and drew up the roadmap for 2023 and its future.
The US giant has revised downwards the predictions of sale, for its fiscal year 2022/23, counting on a turnover of 5,85 billion dollars against the 5,95 billion previously forecast, due to the difficulties encountered in general by the luxury market, particularly in China, of the current economic situation. However, he kept his prediction unchanged earning per share at $ 6,85.
The former Michael Kors group acquired high-end shoe brand Jimmy Choo in 2017 and Italian brand Versace in 2018, renaming itself Capri. “Our initial desire was to make Capri Holdings a large luxury group and I believe we have succeeded,” he said. John D. Idol, president and CEO of Capri Holdings. “We are aware of the current macroeconomic challenges, such as the problems in China and currency fluctuations, but we are more confident than ever in this moment of our three houses, what they represent and what they mean to our consumers”.
"The company will invest especially in new stores and e-commerce, analytics, omnichannel resources and new manufacturing facilities for footwear and accessories,” said the CFO and COO Thomas J. Edwards, commenting on the possibility of acquiring another luxury asset. “We remain interested in aacquisition in the fashion luxury segment, we believe in the growth opportunity within our portfolio, we want to be involved if other European luxury groups arise with a European heritage”, concluded the manager.
Versace aims to represent a quarter of the group's entire turnover
According to forecasts, the group is expected to get 96% of its revenue from Michael Kors in 2022/23, 11% from Jimmy Choo and 20% from Versace. The Milanese house should see its percentage grow in the long term, aiming to represent a quarter of the group's total turnover, while the share of Cross it should decrease to around 62,5%.
Versace is expected to double its sales from $1,2 billion in revenue at the end of this year, with an operating margin of 16%, to $2 billion long-term, with a 20% margin. The major driving force will be the strong expansion of the category of leather accessories, whose sales are expected to quintuple in the future, from $200 million in 2021/22 to $1 billion. The sector also has strong development footwear with an expected increase of $200 million to $300 million over the period. According to the forecasts of the top management of the Italian brand, even theE-commerce it should rise, reaching half a billion dollars, against 140 million today.
The US market is set to decline for the Group, while the Asian market will rise
From a geographical point of view, America it remains the Group's main market, with 57% of sales in 2021/22 and 59% expected for the current fiscal year. But this share is set to drop to 50% in the future while Europe should maintain its 25% percentage. Instead, l'Asia it is expected to account for 16% of total sales in 2022/23 against 17% the previous year and increase its share again in the future, rising to 25%.
In terms of sales networks, the retail channel growth is seen to continue with a share of 76%, versus 69% forecast for 2022/23, while the Wholesale will go from 27% to 21%.
The number of Michael Kors stores in the long term is expected to be around 800, up from 845 this year, Versace's is expected to increase from 225 to 300 and Jimmy Choo's from 243 to 300. In total, this year 42 new openings (16 for Versace, 6 for Jimmy Choo and 20 for Michael Kors).
To achieve its goals, the group will invest about 300 million dollars a year, more than half of which (55%) in the store network, to make new openings or renovations. Investments will also go towards digital technology (20%), omnichannel integration (20%) and European production sites (5%).
Le shares of Capri Holding they finished up 1,89% on Thursday in New York trading. Data for the first quarter of the year is expected on August 9.
