Press Releases
Bulgari Group: revenues continue to grow in the third quarter 2007
- Turnover: 258 million Euro (+13% at comparable exchange rates, +8% at current exchange rates)
- Gross margin: 64.6% vs. 64.7% in 2006
- Operating profit: 46 million Euro (+9%)
- Net profit: 41 million Euro (+20%)
Rome, November 14th 2007 The Board of Directors of Bulgari S.p.A. approved today the consolidated financial statements for the Bulgari Groups third quarter 2007, which highlight a turnover of 258 million Euro increased by 13% at comparable exchange rates (+8% at current exchange rates) in comparison to the same period of last year. In the first nine months of the year turnover increased by 14% at comparable exchange rates (+9% at current exchange rates) from 687 to 746 million Euro.
All the variations reported below are expressed at comparable exchange rates unless noted otherwise.
Revenues by product categories
In the period July September 2007 Jewellery, core business of the Company, registered once again a significant sales increase (+19% compared to the third quarter 2006), which led to a 20% growth in the first nine months of the year.
Watches posted a 4% increase in the quarter and an 8% increase in the first nine months. This performance has been affected in the year by shortages in sourcing some technical components, which resulted in losses of production volume. The Company intends to further strengthen its vertical integration in manufacturing during the next months, which will help to overcome this difficulty.
Accessories turnover registered a 38% growth in the quarter, also thanks to the success of the Fall/Winter collection, thus recovering the performance posted in the first six months and leading to a 3% cumulative increase in the first nine months.
Finally, Perfumes sales rose as well (+8% in the quarter, +16% in the nine months).
Revenues by geographical area
Breaking down the performance by geographical areas, Europe registered a 9% increase in the quarter and a 10% increase in the nine months thus confirming a very strong demand trend. Americas continued to register a very robust growth as well (+20% in the quarter and +24% in the nine months), while Japan, after some negative quarters, registered for the first time in the year a turnaround with a 9% sales increase which led to a cumulated 3% in the nine months. In the rest of Asia the very strong growth trend continued with a 39% increase in the quarter and a 49% increase in the nine months.
Profit & Loss highlights
Gross margin went from 155 million Euro in the third quarter 2006 to 167 million Euro in the third quarter 2007 with a 8% increase. The percentage ratio on turnover remained substantially stable (64.6% vs. 64.7% in 2006). In the nine months gross margin increased by 8% thus going from 441 to 478 million Euro with a 64.1% ratio on turnover (64.2% in the first nine months of 2006).
Total operating costs in the quarter went from 112 to 120 million Euro (+7%): the expected personnel costs increase (+14%) is worth to be mentioned and is due to new recruitments in anticipation of the opening of three flagship stores in October/November 2007 (the Accessory store in Rome, Via Condotti, the Bulgari Ginza Tower and the complex of Omotesando in Tokyo). In the nine months total operating costs increased by 7% and reached 370 million Euro (346 million Euro in the first nine months of 2006). Among the variations, the increased sales expenses (+15%) must be underlined, while the advertising and promotional expenses rose only 2% (+6% at comparable exchange rates).
Operating profit was 46 million Euro in the quarter (+9% compared to 42 million Euro in the same quarter of 2006) and 108 million Euro in the first nine months (+14% compared to 95 million Euro registered in the first nine months of 2006) with a 14.5% ratio on turnover (13.8% in the first nine months of 2006).
Net profit was 41 million Euro compared to 34 million Euro in the third quarter 2006 (+20%) with a 16% ratio on turnover (14% in the third quarter 2006). In the nine months net profit went from 78 to 99 million Euro, registering a 26% growth. This improvement was also due to the results of hedging transactions on exchange rates and precious metals made by the Company and reported as financial incomes.
Balance sheet highlights
Financial net indebtedness of the Group as of 30.09.2007 was 177 million Euro compared to 140 million Euro as of 30.09.2006 and to 47 million Euro as of 31.12.2006.
The increase of the debt in the first nine months, compared to the end of 2006, is in line with the seasonality of the business and is influenced by dividend distribution in May of 87 million Euro and by the acceleration of the investments for 2007.
In accordance with the plans previously announced, in fact, in the first nine months investments in tangible and intangible assets were 59 million Euro, increased by 37% compared to 43 million Euro in the same period of last year.
As of September 30th 2007 the total number of Bulgari Group stores was 236, of which 140 were directly owned stores.
Francesco Trapani, Chief Executive Officer of the Bulgari Group, thus commented : I am very satisfied with the excellent results of the first nine months of the year and with the outstanding sales trend registered in October. Therefore I am convinced that - in presence of a good sales performance in the coming holiday season and in absence of extraordinary events- the Bulgari Group can achieve a growth for revenues at comparable exchange rates and net profits of about 12% in the full year 2007.
Bulgari is one of the global players on the luxury market. In 2006 the Group posted a turnover of 1,010.4 million Euro. With a market capitalization of over 3 billion Euro, Bulgari relies on a stores network in the most exclusive shopping areas in the world and on selected distributors.
Bulgari has a product portfolio that ranges from jewels and watches to accessories and perfumes. The Group is controlled by the Bulgari family, holding about 52.0% of the share capital. The remaining 48.0% is floating on the Milan Stock Exchange.
The manager responsible for preparing the companys financial reports, Alberto Nathansohn, declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance, that the accounting information contained in this press release faithfully represent the Company financial results, as well as its books and accounting records.
BULGARI GROUP PROFIT&LOSS NINE MONTHS
| EUR M. | 9M 2007 | 9M 2006 | DELTA 9M 07/9M 06 |
|---|---|---|---|
| REVENUES | 745.6 | 686.8 | 8.6% |
| EBIT | 108.0 | 95.0 | 13.6% |
| EBIT ON SALE | 14.5% | 13.8% | |
| NET PROFIT | 99.1 | 78.5 | 26.3% |
| NET PROFIT ON SALE | 13.3% | 11.4% |
BULGARI GROUP PROFIT&LOSS THIRD QUARTER
| EUR M. | Q3 2007 | Q3 2006 | DELTA Q3 07/Q3 06 |
|---|---|---|---|
| REVENUES | 257.9 | 239.0 | 7.9% |
| EBIT | 46.3 | 42.3 | 9.4% |
| EBIT ON SALE | 18.0% | 17.7% | |
| NET PROFIT | 40.8 | 34.1 | 19.6% |
| NET PROFIT ON SALE | 15.8% | 14.3% |
BULGARI GROUP REVENUES BY PRODUCT CATEGORY 9M
| REVENUES BY PRODUCT CATEGORY |
9M 2007 | 9M 07/ 9M 06 | 9M 06/ 9M 05 | |||
|---|---|---|---|---|---|---|
| EUR M. | % ON REVENUES |
% REPORTED |
% COMP. FX |
% REPORTED | % COMP. FX | |
| Jewels | 311.7 | 41.8% | 14.5% | 20.0% | 9.1% | 10.2% |
| Watches | 203.5 | 27.3% | 1.7% | 8.1% | 16.4% | 17.3% |
| Accessories | 60.1 | 8.1% | -4.0% | 3.0% | 14.5% | 16.6% |
| Other (incl. FR royalties) | 5.5 | 0.7% | 12.1% | - | 16.2% | - |
| JWA Division | 580.8 | 77.9% | 7.6% | 13.7% | 12.4% | 13.6% |
| PARFUM Division | 147.0 | 19.7% | 11.7% | 15.8% | 14.3% | 15.0% |
| OTHER | 17.8 | 2.4% | 15.6% | - | 28.6% | - |
| TOTAL | 745.6 | 100% | 8.6% | 14.1% | 13.1% | 14.1% |
BULGARI GROUP REVENUES BY GEO AREA 9M
| REVENUES BY GEOGRAPHICAL AREA |
9M 2007 | 9M 07/ 9M 06 | 9M 06/ 9M 05 | |||
|---|---|---|---|---|---|---|
| EUR M. | % ON REVENUES | % REPORTED | % COMP. FX | % REPORTED | % COMP. FX | |
| EUROPE | 283.6 | 38.1% | 10.2% | - | 13.9% | - |
| Of which Italy | 95.2 | 12.8% | 12.2% | - | -1.1% | - |
| AMERICAS | 125.5 | 16.8% | 16.5% | 24.4% | 18.0% | 16.8% |
| ASIA | 295.5 | 39.6% | 6.1% | 15.8% | 10.1% | 12.3% |
| Of which Japan | 157.3 | 21.1% | -12.6% | -3.2% | 15.9% | 21.2% |
| Of which rest of Asia | 138.2 | 18.5% | 40.4% | 49.2% | 0.8% | -1.1% |
| MIDDLE EAST/OTHER | 41.0 | 5.5% | -5.1% | - | 16.7% | - |
| TOTAL | 745.6 | 100.0% | 8.6% | 14.1% | 13.1% | 14.1% |
BULGARI GROUP REVENUES BY PRODUCT CATEGORY 3Q
| REVENUES BY PRODUCT CATEGORY |
3Q 2007 | 3Q 07/ 3Q 06 | 3Q 06/ 3Q 05 | |||
|---|---|---|---|---|---|---|
| EUR M. | % ON REVENUES |
% REPORTED |
% COMP. FX |
% REPORTED | % COMP. FX | |
| Jewels | 105.3 | 40.8% | 13.7% | 18.8% | 7.7% | 9.7% |
| Watches | 71.1 | 27.6% | -1.0% | 4.3% | 12.8% | 14.6% |
| Accessories | 19.5 | 7.6% | 29.4% | 37.8% | -18.2% | -16.4% |
| Other (incl. FR royalties) | 1.8 | 0.7% | 14.3% | - | 19.6% | - |
| JWA Division | 197.7 | 76.7% | 9.2% | 14.6% | 6.9% | 10.1% |
| PARFUM Division | 54.7 | 21.2% | 3.6% | 7.6% | 18.4% | 19.3% |
| OTHER | 5.5 | 2.1% | 5.7% | - | 24.7% | - |
| TOTAL | 257.9 | 100% | 7.9% | 12.9% | 9.6% | 11.2% |
BULGARI GROUP REVENUES BY GEO AREA 3Q
| REVENUES BY GEOGRAPHICAL AREA |
3Q 2007 | 3Q 07/ 3Q 06 | 3Q 06/ 3Q 05 | |||
|---|---|---|---|---|---|---|
| EUR M. | % ON REVENUES | % REPORTED | % COMP. FX | % REPORTED | % COMP. FX | |
| EUROPE | 101.7 | 39.5% | 8.8% | - | 10.1% | - |
| Of which Italy | 31.1 | 12.0% | 5.5% | - | -14.0% | - |
| AMERICAS | 42.6 | 16.5% | 12.4% | 20.4% | 26.1% | 30.1% |
| ASIA | 102.2 | 39.6% | 11.1% | 20.7% | 3.5% | 7.6% |
| Of which Japan | 56.3 | 21.8% | 0.0% | 9.2% | -2.3% | 4.2% |
| Of which rest of Asia | 45.9 | 17.8% | 28.6% | 38.7% | 14.2% | 13.6% |
| MIDDLE EAST/OTHER | 11.4 | 4.4% | -27.7% | - | 9.5% | - |
| TOTAL | 257.9 | 100.0% | 7.9% | 12.9% | 9.6% | 11.2% |
Source: Bulgari S.p.A. Not audited preliminary results.
For further information
| Media Relations | Analysts / investors relations |
| Paolo Piantella | Renata Casaro |
| Corporate Financial Press Office Director | Investor Relations Director |
| tel. +39 06 68 810 593 | tel. +39 06 68 810 467 |
| e-mail paolo.piantella@bulgari.com | e-mail renata.casaro@bulgari.com |
| www.bulgari.com | http://ir.bulgari.com |