Prada’s net revenues for full 2016 totalled €3,184.1 million, representing a decline of 9% at constant exchange rates compared with 2015 (-10% at current). Sales in the retail channel dropped -13% at constant exchange rates to €2,634.9 million (-14% at current), with a “progressive improvement in the trend over the second half of the year, especially in the final months”, according to Prada. Revenue in the wholesale channel increased 15% at constant rates to €504.4 million (+13% at current rates).

Gross margin is said to have remained high and stable at 72% “thanks to relentless focus on industrial efficiencies” and the fashion brand says it has made substantial progress on its cost saving programme, with operating expenses down by 10% compared with 2015. Robust operating margins, with EBITDA at 21% and EBIT at 14%, stabilised in the second half of 2016, according to the report.

Trading conditions in Europe are said to have been mixed for most of the period and ended the year with a decline of 5% at constant rates. Growth in the UK is reported to have been driven by local consumption and tourists taking advantage of the weaker sterling, while continued outperformance in Russia generated double-digit growth over the year. The rest of Europe continued to be impacted by the decline in tourist flows, particularly in France, which in the final quarter of the year however saw significant signs of improvement.

The Asia Pacific region scored an overall negative performance (-12% at constant rates), but “was very dynamic in the second half of the year”. China is said to have recovered in the third quarter of 2016, while Hong Kong and Macau significantly reduced levels of sales seen in recent years, with notable recoveries towards the end of the year. After five years of consecutive growth, sales in Japan declined 13% at constant rates, attributed to a stronger yen that discouraged Chinese tourists.

Sales in the Americas were down 12% at constant exchange rates, impacted by falling tourist flows in the U.S. but positive performances were recorded in Brazil and Mexico, while sales in the Middle East declined 10% at constant rates but an “excellent market response” to the latest collections in the Footwear and Leather Goods division was registered.

“Our offer has been enriched with products that stand out for their innovative style and quality, while at the same time we have also streamlined and rationalised the cost structure across all business lines”, said Patrizio Bertelli, CEO, Prada Group. “The retail strategy has shifted from geographical expansion to network rationalisation and digital integration. We have created new store concepts to enhance customer experiences, with initial encouraging results”, he added.

The Group says it will continue to dedicate significant resources to developing an omni-channel offer, through the roll-out of its global digital platform, collaboration with e-tailers, and in-store digital integration.