Ermenegildo Zegna, the renowned Italian luxury group famous for its high-end menswear, has kicked off the year with remarkable success. Since its recent initial public offering (IPO) on the New York Stock Exchange, the company has achieved an impressive 25.4% growth in the first quarter of 2022, accumulating a total revenue of €377.6 million. The group’s flagship label, Zegna, has particularly stood out, experiencing a staggering surge in sales in the North American market, which has soared by over 85%.
Driving this success is Creative Director Alessandro Sartori, who has spearheaded the focus on the main line of the Zegna brand. This strategic decision has resulted in a commendable revenue of €224 million between January and March. The popularity of Zegna’s high-end leisurewear, footwear, and the strong recovery of its bespoke business, with a 22.1% increase in revenue compared to the same period last year, are key factors contributing to this accomplishment.
Another significant contributor to the group’s growth is the US label Thom Browne, which has generated €98.1 million in revenue, reflecting a 22.3% increase in Q1. An interesting revelation is that sales for Thom Browne’s womenswear collection have exceeded those of its menswear collection during this period.
Additionally, Ermenegildo Zegna’s fabric manufacturing business has flourished in Q1, experiencing a substantial revenue growth of 64.6% to reach €30.2 million. This progress can be attributed to the consistent demand for its products, as highlighted in a press release issued by the company.
Although sales have witnessed an increase across all regions in the first three months of 2022, there has been a notable slowdown in the Asia-Pacific region. Despite accounting for nearly half of the total revenue at €174.8 million, the region only achieved a modest growth of 4.5%. The weak growth in the Chinese market played a significant role in this underperformance, with a marginal increase of 0.3% to €141.9 million. The closure of stores and extensive lockdowns in cities like Shanghai were major contributors to this setback.
Conversely, North America has emerged as the most dynamic market, with revenue reaching €61.8 million, translating to an incredible rise of 85.1%. Sales in the USA alone experienced an outstanding increase of 97.2% to reach €56.9 million. Latin America has also witnessed significant growth, with revenue amounting to €5.6 million, reflecting an 89.1% increase. Europe, particularly France and the UK, has displayed solid growth as well. In the UK, Ermenegildo Zegna’s sales skyrocketed by 111% to €10.9 million, while in Italy, they recorded a 33.1% increase to €64 million. Overall, the EMEA region achieved a revenue of €134.4 million, representing a substantial increase of 38.9%.
Despite these positive results, Gildo Zegna, the CEO of Ermenegildo Zegna, acknowledged the volatility of the market. He pointed out the challenges posed by geopolitical, economic, and health-related uncertainties, and expressed his confidence that both Zegna brands are coping well with these challenges. The company has cautiously forecasted modest revenue growth in 2022 and an improvement in its adjusted earnings, with certain conditions such as the resolution of the COVID-19 pandemic in Greater China and no further deterioration of the situation in Ukraine.
In order to provide investors with insight into its strategy, plans, and sustainable development objectives, Ermenegildo Zegna has scheduled an investor day on May 17. This event will serve as an opportunity for the group to update investors on its progress and future goals.
For more information, please visit:
– Ermenegildo Zegna Official Website
– Ermenegildo Zegna NYSE Stock Information
