Asia sales drive 74 percent jump in Prada profit

AP News
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Posted: Sep 20, 2011 2:10 AM
Asia sales drive 74 percent jump in Prada profit

Italian luxury fashion house Prada SpA says first-half profit surged on strong sales of leather goods such as bags and wallets to Chinese and other Asian customers.

Prada said net income jumped 74 percent to euros 179.5 million ($244 million) in the six months to July 31, from euros 103 million the year before. Revenue rose 21 percent to euros 1.13 billion.

Asia-Pacific sales grew an "outstanding" 35 percent to euros 368 million in the first half, with the Greater China region making the biggest contribution, the company said Monday in its first earnings report since listing on Hong Kong's stock exchange in June.

Asia accounted for the biggest portion of Prada's sales, ahead of both Italy and Europe as a whole. The company's other brands _ Miu Miu, Church's and Car Shoes _ also had strong Asian sales growth.

Prada, which is known for stylish leather handbags, said leather goods played a big role in boosting sales in Asia.

Revenue growth in Asia was boosted by 31 percent sales growth at existing stores as well as the opening of nine new stores in the year to July 31.

Milan-based Prada became the first Italian company to go public in Hong Kong, raising $2.4 billion in an initial public offering aimed at raising awareness of its brand among China's growing number of wealthy and brand-conscious consumers.

Prada and other foreign companies selling luxury goods are betting that China's strong economic growth, increasing urbanization and higher spending by the rich will drive sales growth.