Release Date: July 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Moncler SpA (MONRF, Financial) reported a strong 11% increase in group revenues for the first half of 2024, surpassing the EUR1 billion mark.
- The company achieved a notable operating profit exceeding EUR250 million, with an EBIT margin of 21%, up from 19.2% last year.
- Net income rose to EUR181 million, and the net cash position improved significantly to EUR846 million compared to EUR471 million in June 2023.
- Moncler brand's strategic initiatives, such as collaborations with iconic artists and designers, have enhanced brand visibility and engagement.
- The DTC channel showed robust growth, with a 19% increase in revenues during H1 2024, driven by strong performance across all regions, particularly EMEA.
Negative Points
- Stone Island's revenues declined by 5% in H1 2024, with a notable 24% decrease in the wholesale channel.
- The Americas region experienced a 1% decline in Q2, impacted by challenges in the wholesale channel and department stores.
- Korea and the rest of APAC showed softer trends, affecting overall growth in the Asia region.
- Online business performance was weaker in Q2 compared to Q1, with volatility and promotional activities affecting conversion rates.
- The wholesale channel faced ongoing challenges, with a high single-digit decrease expected for the second half of the year.
Q & A Highlights
Q: Can you provide insights on the trends by nationality and their impact on profitability in Q2?
A: Roberto Eggs, Executive Director, Group Chief Business Strategy and Global Market Officer, explained that Chinese customers showed double-digit growth, although it slowed compared to Q1. Koreans were softer, Japanese were flat but positive locally, and Europeans and Americans showed single-digit positive growth. The profitability was positively impacted by the DTC channel's growth, despite challenges in department stores.
Q: What drove the significant gross margin expansion in H1, and can you maintain this for the full year?
A: Luciano Santel, Executive Director, Group Chief Corporate and Supply Officer, attributed the gross margin expansion primarily to the higher DTC penetration. While the gross margin is expected to grow in H2, predicting the exact EBIT margin is challenging due to market uncertainties.
Q: How did Moncler's price and space impact Q2, and what are the expectations for H2?
A: Luciano Santel noted that the price increase was in the mid-single digits for the year, consistent across both halves. The space contribution is expected to be mid- to high single digits for the full year.
Q: Can you discuss the current trading trends in July and the online business performance?
A: Roberto Eggs mentioned that Q3 trends are consistent with Q2, with EMEA and Japan outperforming. The online business showed weaker performance in Q2 compared to Q1, affected by market promotions and a shift towards physical retail.
Q: How is Moncler addressing the price gap between regions, particularly between Europe and Asia?
A: Roberto Eggs stated that the price gap between Europe and Asia is now below 40%, with a strategic focus on reducing it further. The gap between Mainland China and Japan is around 5%-7%, which is manageable and supports healthy growth in tourist sales.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
