Luxottica Group SpA’s Board of Directors today unveiled a new, simplified organisational structure as it met to announce consolidated net sales and preliminary results for the fourth quarter of 2015 and the full fiscal year 2015.
Adil Khan will leave his role as CEO for Markets and Board Member after a year working in that position, with Chairman Leonardo Del Vecchio assuming the executive responsibilities for Markets. Massimo Vian will continue in his role as CEO for Product and Operations.
Del Vecchio commented: “I’m really grateful to Adil who, with great passion, empathy and professionalism, joined the group in this phase of profound transformation and extraordinary growth. His international experience and knowledge of markets and customers have strongly benefited the company and his contributions will have an impact in the years to come. The entrepreneurial spirit and speed of action that have always distinguished Luxottica, bring us today to simplify our organisational structure.
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“My decision to take on executive responsibilities and more actively contribute to Luxottica’s management comes from the awareness that a renewed entrepreneurial spirit is critical today to properly face this new market scenario and to fast-track the evolution in the Markets area. This is to guarantee that growth, efficiency and investments remain our long-term priorities. We closed another year of record results and start the new one with great enthusiasm. We are well-equipped to manage a global agenda that is becoming more complex but also full of opportunities.”
Khan said: “It has been an absolute privilege to work alongside Massimo and Mr. Del Vecchio in such a strong, beautiful company, exemplary in its global presence. Massimo is a manager of great talent and I have shared with him every moment of the last 12 months, establishing not only a fruitful business partnership but also a true and sincere brotherhood.”
The Italian luxury and sports eyewear company closed fiscal 2015 with an increase in adjusted net sales of +17% (+5.5% at constant exchange rates) to over €9 billion.
The Wholesale and Retail divisions grew by +6.9% and 4.5% respectively, at constant exchange rates, with the group reporting “stellar” increases in e-commerce revenues which were up +50%.
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Sunglass Hut recorded double-digit growth (+10% at constant exchange rates) in total sales for the fifth consecutive year, with Australia, Europe, Brazil and Mexico the top-performing locations.
Europe and emerging markets were big contributors to growth in 2015, with an increase respectively of +6.8% and +13.3% at constant exchange rates. North America also registered “excellent” results, benefiting from buoyant domestic demand.
In the fourth quarter of 2015, adjusted net sales grew by +8.9% (+2.7% at constant exchange rates) exceeding €2 billion. The Retail division’s fourth quarter results were affected by the combined effect of the realignment of the financial calendars and the 53rd week.
Khan and Vian commented: “We’re celebrating another year of outstanding results, confident to double the growth in earnings compared to sales, at constant exchange rates. Determination, agility and a clear strategic roadmap helped us achieve solid organic growth in a challenging macroeconomic environment, and enabled us to improve operations in every business area, setting a solid basis for sustainable long-term growth.
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“This year we implemented several strategic initiatives like the Oakley integration and the launch of a price harmonisation programme in China and in Southeast Asia. We’re especially proud of achievements including the renewal of our license agreements with Prada, Burberry and Dolce & Gabbana, the global launch of Michael Kors, the expansion of Sunglass Hut in new markets and the development of successful partnerships like the one with Macy’s in North America.
“We closed the year 2015 with a very positive outlook. The first few weeks of 2016 and the start of ambitious long-term investment plans have set the stage for another promising year of solid growth, where we expect earnings to grow faster than sales, and expansion into new markets.”
The main growth driver for the group’s net sales in 2015 was North America. The region recorded an increase in total adjusted net sales in US dollars of +3.7% driven by a rise of +6.3% on an adjusted basis in the Wholesale Division.
This performance can be attributed to Luxottica’s integration of Oakley eyewear, a strong contribtution by LensCrafters (+4.3%) and an increase of +4.7% for Sunglass Hut.
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The performance for Europe was positive overall, with increased net sales of +6.8% for the full year. The Wholesale Division grew by +5.1% and the Retail Division posted a rise of +17.3%. Sunglass Hut posted double-digit growth in comparable store sales in Continental Europe and net openings of approximately 50 new stores.
The Asia Pacific region closed 2015 with increased net sales of +5.5% at constant exchange rates. The Wholesale division reported a net sales increase of +8.6%, while the Retail division was up +3.3%. Net sales in Asia improved by +10% at constant exchange rates, driven by Mainland China, Japan, India and Southeast Asia, which benefited from the strong performance of the Wholesale division along with the launch of 42 Sunglass Hut stores between Mainland China and Thailand this year.
The group confirmed its strong growth trend in Latin America, notwithstanding the devaluation of the Brazilian Real. Sales in the region increased by +15.1% at constant exchange rates, driven by Mexico, Chile and Colombia. At constant exchange rates, Brazil showed an “outstanding” performance, growing by +14% in 2015 and up by double-digits in the fourth quarter.
