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Italian brand Brunello Cucinelli defied the wider luxury slowdown in 2023 thanks to its high-end positioning and strong holiday trading, reporting a 23.9 per cent jump in full-year sales to a record €1.14 billion. It has surpassed its €1 billion sales target five years ahead of schedule.
The fourth quarter of 2023 (ended 31 December) was the best in the brand’s history in terms of absolute value, with revenues of €321 million, up 15.6 per cent year-on-year. It also confirmed that it expects sales to grow 10 per cent in 2024, which — while a slower rate than last year — still puts it ahead of the wider luxury goods sector (forecast to grow by around 4 per cent, per Bain).
“Another year that we regard as particularly significant and noble for the brand has ended, with a 23.9 per cent increase in turnover and, given the excellent quality of sales, we are expecting a very good profit,” said Brunello Cucinelli, executive chairman and creative director of his namesake brand, in a statement. He added that its Spring/Summer 2024 collection has seen an “excellent start”.
Signs that the post-pandemic luxury spending boom was running out of steam became apparent when companies reported their third-quarter sales last October. However, brands with a focus on wealthy shoppers rather than aspirational spenders, such as Brunello Cucinelli, Zegna and Hermès, have largely bucked the trend.
Deutsche Bank VP of equity research Matt Garland and analyst Shwetha Ramachandran noted that Brunello Cucinelli’s record results could also reflect “a broader resilience in luxury spending” than expected at the end of the year. This will become clearer when luxury group Richemont reports its results on 18 January.
Brunello Cucinelli, which is known for its high-quality craftsmanship and quiet luxury aesthetic, said its focus on exclusivity and wealthier customers were drivers of success in 2023. The brand won the Neiman Marcus Fashion Award in March and GQ Designer of the Year award in December.
Growth was recorded across all markets in 2023. Europe, which accounts for 37.6 per cent of sales, grew 16.8 per cent to €428.1 million. Americas, which account for 35.5 per cent of sales, were up 20.8 per cent to €404.4 million and Brunello Cucinelli noted demand was strong across all major cities and coasts.
Sales in Asia, which represents 26.9 per cent of the total and is a growing area of interest for the brand, grew 40.4 per cent to €306.8 million. It also highlighted booming demand in the Middle East, South Korea and Japan as opportunities for future growth.
Wholesale channels (which represent 34.5 per cent of sales) grew 13.4 per cent, and retail channels grew 30.2 per cent. “Undoubtedly, 2023 confirmed the centrality of physical retail: at the same time, digital retail now represents a multi-dimensional factor inextricably interconnected with the physical channel, in which the interpretation of the brand’s values [and] identity [are] being integrated more and more closely,” the brand said in its statement.
The company invested around €78 million this year in commercial, digital, technological and production fields, and expects to deepen its investments in its factory in Solomeo and a new men’s tailoring factory in Penne in Italy’s Abruzzo over the next three years.
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