Prada dropped 1.3 percent to close at HK$53.65 in Hong Kong. The city’s benchmark Hang Seng Index declined 0.8 percent.
“The group has operated in a more difficult political and macroeconomic environment than expected with unfavorable exchange rates and a general fall in consumption,” Prada Chief Executive Officer Patrizio Bertelli said in the statement. The company will implement “rigorous” cost controls to protect its margins, he said. In April, Prada forecast same-store sales will rise at a “low single-digit” pace in the financial year through January 2015, less than last year’s 7 percent increase. Growth will be “mid single-digit” the year after, it said then. The company will announce its interim results on Sept. 19.
Retail sales in the first half rose 1 percent to 1.44 billion euros, while sales at the Italian retailer’s 566 directly operated stores climbed 5 percent. Prada’s wholesale channel posted a 2 percent sales increase at constant exchange rates.
In Europe, sales fell 1 percent led by a fall in tourism with poor economic environment affecting domestic demand. Sales increased 19 percent in Japan and 14 percent in the Americas, excluding currency swings, Prada said. Sales in the Asia Pacific region rose 2 percent with weak performances in Korea, Hong Kong and Singapore. China sales accelerated to 12 percent, the company added. Hong Kong retail sales tumbled 6.9 percent year-on-year in June, the fifth straight decline. Sales of watches, jewelry and high-end products plunged 28.2 percent, probably reflecting anti-extravagance measures and slower economic growth in mainland China, according to Bloomberg Intelligence. LVMH last month reported first-half profit from recurring operations fell 5 percent, trailing estimates amid weaker consumption in Asia that was led by slower Chinese spending at home and abroad. Hermes, the maker of Kelly handbags, reported a sales increase of 5.8 percent in the second quarter to 963.4 million euros, lagging behind estimates, as the weakness of the yen and a higher Japanese sales tax weighed on growth. http://www.bloomberg.com/news/2014-08-06/prada-first-half-sales-slow-on-weaker-asia-europe-demand.html