Fashion and Luxury: Listed Companies Slowly Forward in 2014

Year 2014 has been rich in changes for international fashion and luxury companies. Three, in particular, characterized the year according to 2014 Fashion and Luxury Insight (the annual report by SDA Bocconi School of Management and Altagamma which analyzes the accounts of international listed companies with more than €200 million of sales, an always expanding universe, with 87 companies in 2014 vs 79 in 2013).

"First of all, the increase in the number of shops is slowing down", says SDA Bocconi's Paola Varacca Capello. "The 1% increase is the paltriest since 2006 and the 5,9% grow in sales is consequently due to efficiency improvements. Twenty-four companies out of 87 reported a drop in sales".

Furthermore – for the first time – medium-sized enterprises (sales between €1 bln and €5 bln) have the best results in terms of ROI, asset turnover, investments and CAGR.

Last but not least, and it's another first, the luxury segment, even maintaining the primacy in operating performance, grows less than the rest of the sample.

According to Armando Branchini, Fondazione Altagamma Vice-President, "Altagamma companies have been boosting returns, managing cash with discipline and cutting down capital cost in 2014 and 2015 and will go probably on in 2016".

The first accounting data collected in 2015 ring an alarm bell, as growth confirms its decline and margins are worsening.

The team of authors of Fashion & Luxury Insight is made up of Emilia Merlotti, Nicola Misani and Paola Varacca Capello of SDA Bocconi; Armando Branchini participated on behalf of Altagamma.