Announcing its preliminary results for 2017, ahead of the definitive results, which will be reviewed by its board of directors on March 19, the parent company of Kappa, Robe di Kappa, K-Way, Superga and other brands reported aggregated sales of €747.8 million, up by 1.1 percent from the previous year.
The company's Ebitda of €23 million marked a 7.2 percent increase versus 2016. The operating income (Ebit) increased by 9.1 percent to €16.6 million. The gross margin inched up from 40.1 percent to 40.2 percent.
Consolidated revenues, including royalties, sourcing commissions and sales by the Italian licensee, BasicItalia, and an Italian subsidiary, BasicRetail, went up by 1 percent to €183.5 million. Aggregate sales by BasicNet's commercial licensees rose by 1.6 percent to €541.1 million, despite continued political and economic instability in certain Asian and Middle Eastern countries. Income from royalties and sourcing commissions rose by 3.2 percent to €47.0million.
The revenues generated by the Kappa and Robe di Kappa brands grew overall by around 1.9 percent, driven in part by the launch of a new medium/high segment line, Kappa Kontroll. Germany and the Balkans posted the best performances for these brands in Europe, with sales up by 32 percent and 26 percent, respectively. The Turkish market also reported a strong performance, with a 46 percent increase. Revenue growth of 24.6 percent in the Americas was principally driven by the full implementation of new Chilean and Paraguayan licenses, major growth in Brazil and Argentina, and the positive reaction in the North American market to the Kappa Authentic label, the company said. In India, Kappa and Robe di Kappa recorded a 13 percent sales increase. Revenues in Australia jumped by 68 percent. The results in the Middle East and Africa were impacted by political instability in the Middle East and contracting sales in Israel.
The Superga brand experienced strong growth across all American countries. Sales increased by 99 percent in Argentina and by 94 percent in Chile. The Brazilian market grew by 40 percent. Sales in the U.S. rose by 27 percent. The Asian market slowed down compared with the previous year, mainly in South Korea, Japan and Hong Kong. In Europe, Northern Europe and Germany posted solid growth, with sales up by 39 percent and 21 percent, respectively. Sales of the Superga brand overall declined by 5.9 percent, but the company said that orders for 2018 suggest a turnaround.
K-Way reported revenue growth of 12.1 percent overall. The market performance was particularly strong in Europe, where sales were up by 12.6 percent, driven by a 46 percent increase in France. Sales of the brand in Italy grew by 9 percent. Retail development also boosted the growth in Europe, with 29 stores now open in Italy and 11 in France. Sales in the Americas declined due to the phaseout of the brand's North American license. A new licensee is now operative, the company said, without mentioning its name. Asia and Oceania reported growth, mainly driven by Taiwan and South Korea. The first K-Way store in London opened in the Covent Garden distict last year. Also during 2017, K-Way opened a flagship store in the Marais district of Paris.
As of Dec. 31, 2017, Kappa and Robe di Kappa mono-brand stores and shop-in-shops opened by licensees globally were 931, of which 107 were in Italy. There were 285 Superga mono-brand stores and shop-in-shops around the world, of which 63 were in Italy. There were also 46 K-Way sales points, 29 of them in Italy.
Brand sales for Briko, a brand that has been mainly distributed on the Italian market since April 2016, rose by 51.4 percent. New licenses were signed for the brand in 2017 for the territories of Austria, Germany, Norway, Sweden, Finland, the Baltic countries and South Korea.
Last July, BasicNet acquired the Sebago brand from Wolverine Worldwide for an overall price of $14.2 million, in addition to accessory acquisition charges, with a sales launch scheduled for 2018. In the previous month, the subsidiary Basic Properties America had sold the Lanzera brand, which no longer featured within the group's strategic plans.