De Rigo S.p.A. (NYSE: DER – news) posted net sales and revenues of ITL 255.7 bn (Usd 117.2 m(1))in the first quarter of 2001, an increase of 18.4%, as compared with sales of ITL 215.9 bn (Usd 99.0 m) in the first quarter of 2000. The increase in the Group's net sales is primarily attributable to the inclusion of a full quarter of the results of De Rigo's Spanish optical retail chain — General Optica (“GO''), which was acquired in February 2000 and thus consolidated for only two months in the comparable period of 2000. The increase also reflected strong growth in the Group's wholesale and manufacturing business and the contribution of sales from Eyewear International Distribution (“EID''), the joint-venture with the Prada Group for the marketing and distribution of Prada-branded eyewear, which had just commenced operations in the first quarter of 2000. The positive impact of these factors on the Group's net sales was partially offset by foreign currency translation differences (primarily related to the translation of Pounds Sterling into Lire), which reduced the overall magnitude of the increase by approximately 1.4%.
De Rigo reports sales for each of its three principal lines of business: wholesale & manufacturing, retail and EID, as well as reporting net sales and revenues on a consolidated basis. In calculating its consolidated net sales and revenues, De Rigo has eliminated intercompany sales among the Group's lines of business, as detailed in the table accompanying this release.
The Group's consolidated net sales of ITL 255.7 bn (Usd 117.2 m) for the first quarter of 2001 were broken down as follows: eyewear sales of ITL 198.3 bn (Usd 90.9 m), contact lenses sales of ITL 31.1 (Usd 14.3 m), and other sales and revenues of ITL 26.3 bn (Usd 12.1 m), as compared with sales of ITL 165.7 bn (Usd 76.0 m), ITL 25.3 (Usd 11.6 m) and ITL 24.9 bn (Usd 11.4 m), respectively, for the first quarter of 2000.
Total unit sales increased by 12.4% to 1,626,060 units. Unit sales of sunglasses increased by 7.3%, as compared with the first quarter of 2000, and accounted for 64.8% of the Group's overall unit sales, having represented 67.9% of unit sales in the first quarter of 2000. Unit sales of prescription frames increased by 23.0%, as compared with the comparable period last year, and accounted for 35.2% of the Group's overall unit sales, having represented 32.1% of those sales in the first quarter of 2000.
Wholesale & manufacturing sales amounted to ITL 72.7 bn (Usd 33.3 m), as compared with sales of ITL 58.1 bn (Usd 26.6 m) in the first quarter of 2000, with the increase of 25.1% being primarily attributable to growth in certain European markets, principally France, the UK and Italy, and to increased intra-Group sales made to EID and to the Group's retail companies.
Net sales through retail companies amounted to ITL 177.0 bn (Usd 81.1 m), an increase of 13.3%, as compared with sales of ITL 156.2 bn (Usd 71.6 m) during the first quarter of 2000.
GO, the Group's Spanish retail company, posted net sales of ITL 55.1 bn (Usd 25.3 m) during the first quarter of 2001, with an increase on a comparable, same store basis of 3.4%. In 2000, GO posted net sales of ITL 36.0 bn (Usd 16.5 m) during the two months of the quarter in which it was consolidated by De Rigo. At 31 March 2001, GO operated a network of 129 owned shops, having opened 3 new shops during the first three months of 2001. Since the end of the first quarter 2000, the company has opened 17 new shops, further implementing its growth strategy.
Net sales of Dollond & Aitchison (“D&A''), the Group's British retail company, totalled ITL 121.9 bn (Usd 55.9 m) in the first quarter of 2001, an increase of 1.4% as compared with sales of ITL 120.2 bn (Usd 55.1 m) in the comparable period last year. Excluding the effect of foreign currency translation differences, D&A's net sales increased by 4.5%. Same-store sales increased by 5.0%. Sales of franchised shops totalled ITL 31.9 bn (Usd 14.6 m), with the increase, at constant exchange rates, of 13.6% reflecting the effect of the conversion of owned shops into franchised operations during 2000. At 31 March 2001, D&A operated a network of 235 owned shops and 148 franchised shops, as compared to 248 owned shops and 140 franchised shops as at 31 March 2000, with the difference reflecting the completion of D&A's process of transforming underperforming company-owned shops into franchised stores.
Net sales through EID, the joint venture with the Prada Group, more than doubled to ITL 11.9 bn (Usd 5.5 m), as compared to sales of ITL 5.1 bn (Usd 2.3 m) in the same period of 2000, with sales spread throughout the world.
Analysing the Group's net sales in the first quarter of 2001 by geographic area, net sales in Europe increased by 16.0% to ITL 230.1 bn (Usd 105.5 m), primarily as a result of the full period consolidation of GO and growth in the above mentioned European markets. Net sales in the Americas increased by 90.7% to ITL 8.2 bn (Usd 3.8 m), primarily reflecting the growth of the wholesale division and the impact of sales of Prada-branded eyewear in the US market. Net sales in the Rest of the World posted an increase of 31.8% to ITL 17.4 bn (Usd 8.0 m), also reflecting sales of the wholesale division and of Prada-branded eyewear.
De Rigo is one of the world's largest manufacturers and distributors of premium eyewear, the major optical retailer in Spain through General Optica, one of the leading retailers in the British optical market through Dollond & Aitchison and a partner of the Prada Group for the manufacture and distribution of Prada Eyewear and of LVMH Fashion Group for the manufacture and distribution of Givenchy, Loewe and Celine eyewear.
(1) The Group considers its results in Lire to be a more accurate measure
of its financial performance, due to the distortional effect of
currency translations. The results reported in Usd are converted from
Lire using the exchange rate as fixed by the European Central Bank on
April 30th, 2001 of EURO 1=Usd 0.8876 and the statutory fixed exchange
rate of EURO 1=ITL 1,936.27. The financial results reported in this
press release have not been audited by the Group's independent public
accountants and are presented on the basis of accounting principles
generally accepted in Italy.