Feb 14, 2023
OTB soars in 2022 driven by luxury
Feb 14, 2023
OTB ended 2022 on a high note, thanks to the strong performance of its luxury brands. A division that has been strengthened with the acquisition in 2021 of Jil Sander. The Italian fashion group which, in addition to its jeans brand Diesel, also owns Maison Margiela, Marni and Viktor & Rolf, achieved a turnover of 1.743 billion euros last year, up 14% on 2021. Net sales, i.e. excluding royalties and other income, amounted to 1.63 billion euros (+12%).
Notably, sales in the luxury division jumped 32% year-on-year and 103% compared to 2019, at pre-pandemic levels, the company said while publishing its annual results, without specifying the segment's turnover. It nevertheless highlighs the performance of Marni, whose sales have climbed 29%, with Francesco Risso at the helm of style since 2016. Taking over from the label's founder Consuelo Castiglioni, he has succeeded in revitalising the house by rejuvenating its clientele with inventive creativity and communication, and above all with original, well-attended fashion shows, which for the past two seasons have taken on a nomadic format, from New York to Tokyo.
Maison Margiela, which has been able to count on John Galliano as its creative director since 2014, remains the most important label in terms of sales for this luxury division, with an increase in turnover of 24% compared to 2021. As such, it has just moved into a new, larger headquarters at Place des Etats-Unis in Paris. Finally, Jil Sander, the German label run by Lucie and Luke Meier, which completed its first full year within the OTB group in 2022, has also upped its numbers (+61% compared to 2021, when it had been with the group for nine months).
However the company has not shared any figures regarding its flagship brand, Diesel, led since 2020 by the Belgian designer Glenn Martens. It is continuing its repositioning in a segment that it describes as "alternative to luxury" through "very significant investments in the product, communication and the renewal of the image of its stores". Aiming more at the high-end segment, as an informal luxury brand, the jeans maker has launched a rationalisation of its distribution, which has resulted in a loss of 400 million euros in sales in recent years. The label, which has been without a chief executive since the recent departure of Eraldo Poletto, has made it into the top 10 most popular brands in the Lyst Index 2022, while its new 1DR bag model is regularly out of stock, the company said in a statement.
The group also owns Brave Kid, which specialises in children's fashion, as well as the production and distribution company Staff International, which is in charge of its luxury houses and also manages licensed brands such as Dsquared2 and has taken over the production of Jil Sander's collections in-house. The group also took a minority stake in the Californian luxury denim label Amiri in 2019, for which it manages exclusive distribution in Asia-Pacific and Japan.
In 2022, OTB continued its investments. It reached 81 million euros (+71% compared to 2021), opening 73 new stores in key markets such as China, South Korea and the United States. The company has also invested in digital innovation through its BVX division, while reorganising Staff International's industrial structure around four new segments: Ready-to-Wear, Shoes and Bags, Logistics and Licensing. These efforts have not prevented the company from strengthening its net cash position, which now stands at 293 million euros.
In this context, Renzo Rosso's holding company has seen its profitability improve significantly. In 2022, it generated a net profit of 105 million euros "up 44 million compared to the 2021 profit if we do not take into account non-recurring items", it said in its press release. It recorded a gross operating profit (Ebitda) of 314 million euros, up 22% excluding non-recurring items. The net operating result (Ebit) reached 134 million euros (+42%).
Geographically, Asia-Pacific is confirmed as a strategic region. Japan remains one of its most important markets, accounting for almost 25% of total group turnover. China is another region where OTB has strengthened its presence, opening its largest shop in the world in Shanghai last year in the JC Plaza shopping centre. Finally, since the opening of its subsidiary in South Korea in 2021, fifteen new points of sale have been set up in that country. In addition to Asia, OTB also recorded its best performance in North America, where it consolidated its position with thirteen new shops.
In addition to this strengthened presence in regions with greater potential, such as Asia and the United States, the company has strengthened its ties with its suppliers, creating "an efficient ecosystem and solid production bases for our brands", emphasises managing director Ubaldo Minelli, who also mentions "the launch of projects to innovate our logistical platform, with significant investments in the automation of our warehouses and the creation of synergies that are essential for the growth of our brands".
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