Jimmy Choo: Did it stumble or still striding ahead?

Jimmy Choo ss16.jpgThere were some dire warnings about Jimmy Choo ahead of today’s 2015 results announcement so were the doom-mongers right?  Well the release containing its full-year figures is headlined “Continued Strong Performance”. So maybe not.

The company said it saw currency-neutral revenue growth of 7.2% (or 6.1% on a reported basis), consolidated net income up £30.2m to £19.4m (after it made a £10.8m loss a year ago), adjusted ebitda up 1.5% to £51m and a strong performance in Asia, especially Japan. Comparable retail sales edged up 1.1%.

CEO Pierre Denis was upbeat, talking of “delivering sustained renovation of the retail portfolio” and “meeting development targets” while referring to “the many challenges facing the sector”.

So not at all bad then but still a note of caution. In fact, the company is outpacing overall luxury sector growth (albeit from a much lower starting point) and successfully reversed the first half decline in wholesale revenues.

Its growth in Asia is particularly important because, despite the challenges the region faces, it’s still key to luxury brand success.

The main driver of revenue growth in 2015 was shoes (surprise, surprise), representing over three quarters of the business. Accessories volumes remained stable, with the trend towards smaller bags being key. And the men’s business is taking off, now representing 7% of revenues and reflecting an increase in the number of dual gender stores in the year.

jimmy choo 2

Jimmy Choo for Moon Boot and the Rafael Mantesso collection

During 2015, it also launched the Illicit fragrance and this, along with the continued roll-out of the Jimmy Choo Man fragrance contributed to strong growth in Licence income. And the company made good progress in both sunglasses and eyewear.

One-offs helped drive sales upwards as well. Creative director Sandra Choi’s design of the Jimmy Choo take on the Cinderella shoe saw orders for “many hundreds of pairs” and there were two successful capsule collections during the year. In June, Jimmy Choo announced a limited edition collaboration with Moon Boot. And a month earlier there was the Choo Hound collection which incorporated Brazilian artist Rafael Mantesso’s drawings of his English Bull Terrier called Jimmy Choo, in the form of a series of illustrations commissioned by Choi to decorate a selection of Jimmy Choo accessories.

I just wish I’d bought some shares when they dipped a few days ago.

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