Ermenegildo Zegna, the renowned Italian luxury fashion group, faced a downturn in its performance in 2022 due to the strict measures implemented in China to combat the spread of Covid-19. Despite this setback, the group managed to report revenues of €1.49 billion for the year, representing a 15.5% increase compared to 2021. However, the fourth quarter saw a decline in sales, with a decrease of 0.5% and €407 million in revenue.
The impact of Covid-related restrictions in the Greater China region, particularly from mid-March to the end of May and during the fourth quarter, significantly affected Ermenegildo Zegna’s performance. However, the company stated that if we exclude the Greater China region, revenues would have experienced a significant increase of 42% for the 2022 financial year and 24.7% in the fourth quarter.
In spite of the challenges faced in China, Ermenegildo “Gildo” Zegna, the head of the group, remains optimistic about the company’s growth in 2022. He attributes the strong performance to the success of their strategy, global reach, and impeccable execution, especially in the Middle East, the US, and Europe. Furthermore, he highlighted a positive recovery in business and the industry as a whole during his recent visit to China.
Ermenegildo Zegna’s flagship brand, Zegna, led by Alessandro Sartori, achieved a turnover of €924 million in 2022. This success can be attributed to the popularity of its high-end leisurewear and footwear offerings, as well as its made-to-measure business in the United States and Europe. The Zegna segment, which includes the Zegna brand products, the group’s textile line, and third-party brands, generated €1.17 billion in revenue last year.
Another brand under the Ermenegildo Zegna Group, Thom Browne, experienced significant growth in 2022, with a turnover of €330 million, marking a 25.3% increase from the previous year. The brand witnessed a 47.7% growth in wholesale sales, driven by excellent performance in the US, Europe, and Japan. In the fourth quarter, Thom Browne’s revenue increased by 11.4% to €76 million. The company also announced its agreement with its Korean partner Samsung C&T Corporation to have direct control over its activities in South Korea.
Looking ahead, Ermenegildo Zegna Group expects a slight improvement in its operating result for 2022. The company’s medium-term objectives remain unchanged, aiming for an operating margin of at least 15% and a turnover of €2 billion. Additionally, the group recently signed an agreement to acquire a minority stake in the Canadian technical running shoe company Norda Run and will manage the fashion activities of Tom Ford through a long-term license agreement with Estée Lauder, further solidifying its position in the luxury market.
Useful Links:
1. Ermenegildo Zegna Official Website
2. Thom Browne Official Website
