Luxottica: strong profit as full-year sales meet guidance
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Luxottica: strong profit as full-year sales meet guidance

 A strong fourth quarter saw Luxottica end the fiscal year meeting guidance on sales, and seeing adjusted net income grow impressively from the previous year. The company is still waiting for antitrust approval of the €50 billion merger with Essilor that was agreed a year ago. Between them, the companies will create a lens-to-frame manufacturer with a huge, worldwide, retail network and portfolio of top brands under its control.

Luxottica’s share price has moved 2% up in the first month of 2018

graph 0202 luxottica

SOURCE: Yahoo Finance

Stripping out currency effects, Luxottica’s net sales were up 2% year over year, in line with the company’s guidance. That works out as €9.16 billion, which is also on target according to consensus estimates. The company won’t reveal its entire full-year earnings report for 2017 until February 26, but has stated that “adjusted net income is expected to grow strongly.

As to the fourth quarter:

Sales were up by 4.3% year on year, easily outperforming the pace of growth in the first nine months of the year, which were closer to 2% on average. The difference was down to North America, in large part, where Luxottica saw improvements towards the end of the year.

The company released a statement saying: “The fourth quarter of 2017 was the best of the year for the wholesale business, retail comparable store sales, Sunglass Hut performance in its main geographies and e-commerce sales.

Disclosure

Dominion holds Luxottica in its Global Trends Luxury Fund.


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