News alert: Prada scored 41% y-o-y revenue growth in 2021
Prada made an announcement that confirmed its full year revenue of EUR3364m, up 41% y-o-y or up 8% versus 2019, both on constant currencies, slightly above expectations
The company saw an excellent performance in its core retail channel. During 2H21, sales of directly-operated stores (including e-retailing) rose by 27% y-o-y, or up 21% versus 2H19, both on constant currencies.
Supported by the higher contribution from its retail operations and more full-price sales, the company scored a significant increase in EBIT, although no details were disclosed in the announcement
Rationalization of the wholesale channel also continues to run according to its business strategies
Its strong cashflows supported a sound net cash position
While no further details were provided in the announcement, we believe Prada has increasingly strengthened its foundation over the past 2 years and built a strong position to sustain sound performance ahead. The company has earlier targeted at an 11% EBIT margin for 2021, while this could now translate into an EBIT of c.EUR370m, up about 170% y-o-y or up about 20% versus 2019
Our current target price is HK$63.86. We reiterate a BUY on the counter and will fine-tune our numbers according to its latest report
