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Ermenegildo Zegna Group has delivered solid results for the third quarter, with revenues up by 20.8 per cent year-on-year to €431 million.
In the first nine months of the year, revenues were €1.33 billion, up 22.9 per cent year-on-year. Growth was driven by strong performance in the US and EMEA and a focus on direct-to-consumer sales.
The group, which owns Zegna and Thom Browne, became the exclusive licensee for the Tom Ford fashion business in April, with new creative director Peter Hawkings making his debut in September in Milan with the Spring/Summer 2024 collection. “Our results this quarter continue to showcase the broad-based strength of our three brands and the successful execution of our strategy,” commented chairman and CEO Ermenegildo Zegna. He said the group is “performing well across a diverse set of regions, as the balance of our geographic mix provides resilience in a highly dynamic environment”.
Updated financial goals through to the end of 2025 will be announced at a Capital Markets Day in December. The group said it is on track to meet one target by late 2025 — annual revenues topping the €2 billion mark.
On Wednesday, Zegna Group, which includes Zegna, Thom Browne and Tom Ford Fashion said profits increased 147.9 per cent in the first half but flagged “softer performance” in mainland China in the last weeks.
The Zegna brand’s revenues grew 3 per cent year-on-year to €298 million in the third quarter and 12.7 per cent to €950 million in the first nine months. The performance was driven by direct-to-consumer (DTC) sales, which offset the ending of Tom Ford’s third-party distribution agreements. Reflecting an industry trend for closer control, Zegna is buying back its business from its South Korean franchise partner, taking direct control from Q1 2024. In terms of product, luxury leisurewear, made-to-measure and footwear all performed well.
Revenues at Thom Browne grew 6.3 per cent year-on-year to €74 million in the third quarter and 10.4 per cent to €282 million in the first nine months. Womenswear outperformed, representing 30 per cent of total revenues in Q3. In the five months following its acquisition in late April, Tom Ford Fashion generated revenues of €139 million, with revenues of €75 million in the third quarter.
While many luxury brands have faced weakened demand in the US this year, Zegna is an outlier. North America revenues grew 44.2 per cent year-on-year in the third quarter to €111 million, with US revenues within that accounting for €102 million, up 47.8 per cent. The group says the strong performance was due to the Tom Ford Fashion segment as well as DTC performance for Zegna and Thom Browne.
EMEA also performed well in the quarter, with revenues growing 27.7 per cent to €152 million, again driven by DTC demand for the Zegna and Thom Browne brands. APAC revenues grew a comparatively modest 3.5 per cent in the quarter, reaching €158 million. Greater China had a 3.4 per cent decrease in revenues in the quarter to €112 million, though overall, the first nine months showed positive growth of 15.3 per cent year-on-year to €419 million.
Switching focus to DTC has been a priority for the group. Revenues from DTC channels grew 29.9 per cent in the third quarter to €282 million. In the first nine months, DTC accounted for 64.8 per cent of revenues.
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