Italian firm Ermenegildo Zegna reported a profit of €65.3 million in FY22

Ermenegildo Zegna Group, an Italian luxury fashion and lifestyle brand, posted a profit of €65.3 million in fiscal year 2022 (FY22), a significant improvement from the €127.7 million loss reported in FY21. Adjusted profit for FY22 was €73.6 million, down slightly from €75.3 million in FY21.

The company’s revenue in FY22 was €1,492.8 million, a 16-percent increase over the previous year. The Zegna segment, which is the brand’s flagship division, saw a 14-percent year-on-year (YoY) revenue increase, totaling €1,176.7 million. Meanwhile, revenue in the Thom Browne segment grew by 25 percent, amounting to €330.9 million, the company said in a press release.

Italy’s Ermenegildo Zegna Group reported a profit of €65.3 million in FY22, a significant improvement from the loss reported in FY21, driven by a 16 percent year-on-year rise in revenue. The company aims to exceed €2 billion in annual revenue and achieve a 15 percent adjusted EBIT margin by FY25, with double-digit revenue growth expected in Q1 FY23.

Adjusted EBIT (earnings before interest and tax) for the group rose 6 per cent to €157.7 million in FY22, up from €149.1 million in FY21. However, adjusted EBIT margin declined by 90 basis points from 11.5 percent in FY21 to 10.6 percent in FY22.

Zegna segment adjusted EBIT was €141.5 million in FY22, a 7-percent year-on-year increase. The segment’s adjusted EBIT margin was 12.0 percent, compared to 12.7 percent in FY21. For the Thom Browne segment, adjusted EBIT in FY22 was €48.1 million, a 26-percent year-on-year increase. The segment’s adjusted EBIT margin was 14.5 percent, up from 14.4 percent in FY21.

In FY22, the company progressed on its environmental, social, and governance (ESG) commitments made in May 2022, including submitting the group’s net-zero target to the Science-Based Targets Initiative (SBTi), the release added.

By the end of fiscal year 2025, Ermenegildo Zegna aims to exceed €2 billion in annual revenue and achieve an adjusted EBIT margin of at least 15 percent, excluding the Tom Ford fashion business. The Group expects FY23 results to show that it is on track to achieve these goals, assuming no further escalation of the war in Ukraine, no significant macroeconomic or financial market deterioration, no further disruptions associated with the COVID-19 pandemic, and no other contingencies. Incidentally For the first quarter of FY23, the company expects a double-digit revenue growth

Ermenegildo ‘Gildo’ Zegna, Chairman and CEO of the Zegna Group, said: “Last year, we embarked on a journey to rebrand our namesake label, as we unveiled the Zegna One brand. We are still at the beginning of this journey, having just launched the second season and several new initiatives.

“2023 is off to an encouraging start with strong double-digit performance across the Group’s retail network and I am optimistic that the Greater China region will reopen following the Covid-19-related restrictions and with the positive response to our collections we are seeing from our customers worldwide, our global Business will continue to drive growth. However, it is important to recognize that the current financial uncertainty and an ever-changing global environment are likely to affect consumer attitudes and purchasing patterns.”

Fibre2Fashion News Desk (DP)

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