Milan–Luxottica, the world’s biggest eyewear group, is targeting net profit of 400 million euros (about $561.5 million) in 2010, above its previous full-year target and 27% higher than in 2009, after beating forecasts with its third-quarter results.
The company posted this week a 34.5% rise to 101.9 million euros in net profit for the third quarter, above all analysts’ forecasts, helped by strong sales at high-end brands such as Ray-ban and Oakley.
“We hope that the good performance this year will allow us to look to 2011 positively,” Andrea Guerra, ceo, told analysts after the results. “The results achieved so far allow us to look optimistically toward a year-end that, if we continue to work with the determination and passion shown in recent months, may allow us to reach the threshold of 400 million of net income,”
Luxottica said in a statement net sales rose 19.7% to 1.464 billion euros, boosted by a rebounding appetite for luxurygoods in mature European and U.S. markets, despite continued employment concerns and a weaken dollar.
Mature Markets Rebound
“All our people were able to strongly react to and make the best of the opportunities offered by the New World in which we operate. Such results may be summarized in a solid growth in so-called mature markets–net sales in Europe were up by 12.7% and net sales in U.S. dollars in North America rose by 8.5% over the third quarter last year–as well as in a strong increase in key emerging markets, where net sales grew by 26% over last year,” Guerra said.
Sunglass Hut, the company’s specialty sunglass chain, posted successful performances both in the United States, where comparable store sale were up by 12.5%, and globally.
In July, the company said it was on track to meet its full-year targets of a mid single-digit sale growth for 2010, with net profit expected to rise three times that level. Analysts had expected on average Luxottica to post net profit of 98 million euros in the quarter, in a range of 94 million to 101.7 million euros.
Luxottica approved on Monday the launch of a 5- to 7-year euro bond for up to 500 million euros, aimed at extending maturing debt and fund market operations. The issue, for institutional investors, is expected by end January 2011.
Luxottica, which also makes sunglasses for brands such as Prada, Bulgari and Ralph Lauren, has said it expects an annual $100 million revenue boost from a license deal signed with Coach last month, with production starting from January 2012.