Italian company Ermenegildo Zegna’s revenue jumps 23.9% in H1 FY23

Italian luxury fashion house Ermenegildo Zegna Group has reported revenues of €903.1 million, a remarkable 23.9 per cent increase year-over-year (YoY) in the first half of fiscal 2023 (H1 FY23). This surge is attributed to the vigorous double-digit growth in its Zegna and Thom Browne segments, which expanded by 23.8 per cent and 13.6 per cent respectively on an organic basis. Furthermore, the recent acquisition of Tom Ford International on April 28, 2023, fortified the revenue stream, chipping in an additional €64 million through the Tom Ford Fashion segment.

The company’s profit margin leaped from 2.9 per cent in the first half of FY22 to 5.8 per cent in H1 FY23. The group’s profit similarly witnessed a notable surge, tallying at €52.1 million, a striking growth of 147.9 per cent YoY from a previous figure of €21 million. Adjusted profit trailed closely, standing at €54.9 million, up 140.5 per cent YoY, demonstrating healthy profitability in the group’s operations.

Italian luxury fashion firm Ermenegildo Zegna Group reported a 23.9 per cent YoY increase in revenues, hitting €903.1 million in H1 FY23, driven by substantial growth in the Zegna and Thom Browne segments.
Profits surged to €52.1 million, a 147.9 per cent YoY increase, with a profit margin growth from 2.9 per cent in H1 FY22 to 5.8 per cent in H1 FY23.

Gross profit was €579.8 million in H1 FY23, a substantial 29.2 per cent YoY increase from €448.8 million in the first half of FY22, driven primarily by a surge in direct-to-consumer sales, which buoyed the gross profit margin from 61.6 per cent to 64.2 per cent. However, the selling, general, and administrative expenses also swelled by 24.9 per cent, hitting €415.8 million, marking a slight hike as a percentage of sales to 46 per cent, the company said in a press release.

Adjusted EBIT was €119.9 million, a hearty growth of 45 per cent YoY from the €82.7 million recorded in H1 FY22, pushing the adjusted EBIT margin to 13.3 per cent, a 2 per cent increase from the prior year.

Segment-wise, the Zegna division spearheaded the earnings before interest and taxes (EBIT), documenting €100.5 million, a hefty 47.8 per cent boost YoY, enhancing the adjusted EBIT margin to 15.4 per cent from 12.3 per cent in H1 FY22. Thom Browne followed suit, albeit with a relatively flat EBIT of €31.5 million, a slight decrement in the EBIT margin to 15.2 per cent from 17 per cent in H1 FY22. Tom Ford Fashion reported EBIT of €3.7 million, securing an EBIT margin of 5.7 per cent.

“Throughout the first half of the year, Zegna Group’s unique capabilities have been on full display, contributing to continued and strong revenue growth. This is particularly evident in the outstanding performance in the US and EMEA, as we communicated back in July, as well as in our significant progress towards growing profitability. Our performance during this six-month period again confirms the successful execution of our strategy, including our Zegna One Brand strategy,” said Ermenegildo ‘Gildo’ Zegna, chairman and CEO.

Fibre2Fashion News Desk (DP)