MILAN – Driven by continued strength at its direct-to-consumer channel and strong business in the Americas and Greater China, the Ermenegildo Zegna Group reported solid gains in the first nine months of the year, including in the third quarter.
In the nine months ended Sept. 30, group sales rose 7.2 percent to 1.42 billion euros, compared with 1.32 billion euros in the same period last year. In the third quarter, revenues reached 433.8 million, an increase of 8.9 percent year-on-year.
In an interview, Gildo Zegna, chairman of the group, expressed his satisfaction with the performance of China, saying that “we fixed the motor and it’s performing well after two years of tuning the engine.” He touted the “excellence of the service and our personalization and attention to details” and the positive feedback received in the region for the Zegna brand’s Su Misura, Vellus Aureum and Triple Stich shoes, for example. He also credited the two exclusive Salotto areas in Shanghai and Beijing for the elevation of the brand. “Hong Kong has been picking up since the beginning of the year, and Macao has also helped.”
“This was another quarter of solid progress for our group. Direct-to-consumer continued to drive our growth, led by Zegna, which delivered a robust 16 percent organic increase in the DTC channel,” he said. “I am also pleased with our group’s performance across all regions. In particular, the Americas continued their double-digit trend despite an increasingly demanding comparison base.”
He revealed a new Salotto Zegna will open in New York above the brand’s flagship.
“As we enter the final months of the year, we look ahead with cautious confidence. While the global environment remains uncertain, we stay focused on what has always set us apart: our close relationships with our clients grounded in more than a century of craftsmanship.”
In the nine months, sales of the Zegna brand totaled 918.4 million euros, a 12 percent gain compared with 819.8 million euros in the same period last year.
In the third quarter, revenues climbed 13.8 percent to 283.8 million euros, driven by strong DTC organic growth across all regions.
In the nine months, revenues at Thom Browne decreased 5 percent to 168.5 million euros. In the third quarter, the brand reported that sales were down 5.9 percent to 45.4 million, mainly reflecting the more challenging consumer environment in the Greater China region and the ongoing streamlining of the wholesale channel.
Thom Browne, said Zegna, is “the only band that was impacted by a difficult third quarter, we have to find the right formula for the brand in China.” A new collaboration with Asics will drop in the fourth quarter, which the executive expects to receive good feedback.
In the nine months, revenues for Tom Ford Fashion totaled 226.4 million euros, up 3.5 percent and in the third quarter, sales rose 5.4 percent to 69.6 million euros with both channels contributing positively. New stores will open in South Coast Plaza, Bal Harbour and San Diego in the next weeks, said Zegna, also citing the new flagship to be unveiled in Paris in the first quarter next year.
Textile revenues edged up 1 percent to 97.9 million euros in the nine months, while sales rose 3.5 percent in the third quarter.
In the nine months, the group’s DTC revenues climbed 12.4 percent to 1.11 billion euros, and in the third quarter the channel reported a 13 percent gain driven by the Zegna brand.
In the nine months, wholesale branded revenues totaled 195.2 million euros, a decrease of 11.8 percent. In the third quarter, the channel was down 5.2 percent to 63.4 million euros.
By geographic markets, in the nine months the Europe, Middle East and Africa region recorded revenues of 491.4 million euros, up 2.4 percent, representing 35 percent of the total. In the third quarter, EMEA recorded a 6.9 percent increase in sales, driven by double-digit growth at Zegna.
The Middle East region delivered a strong sequential improvement in the quarter.
In the nine months, revenues in the Americas totaled 440.7 million euros, up 14.7 percent, accounting for 31 percent of the total. In the third quarter, the area was up 14 percent with the Zegna brand leading with double-digit growth in the DTC channel. Tom Ford Fashion also delivered solid growth in the region.
The Greater China region reported revenues of 320.2 million euros, a 6.6 percent gain, representing 22 percent of the total. In the third quarter, the area rose 8.7 percent, driven by Zegna’s DTC channel, partially offset by the negative performance at Thom Browne.
Revenues in the Rest of Asia-Pacific reached 166.9 million euros, a 4.9 percent gain, accounting for 12 percent of the total. In the third quarter, revenues increased by 3.6 percent.