Direct, licensed and franchised sales increased by 5.1 percent to €662.7 million at De Rigo in 2007. Consolidated revenues went up by 4.6 percent to €582.2 million, but the wholesale business went much better than the company's retail operations. While General Optica continued to perform well in Spain, with 228 stores at the end of the year, the 398-store network of Dollond & Aitchison in the UK had a slight decline.
The British chain, which added 13 franchised stores in the past year, suffered a 2 percent sales drop on a same-store basis in euros, but its revenues remained more or less flat in terms of pounds sterling. Sales grew by 8 percent for the Spanish chain in absolute terms, due in part to the addition of 13 company-owned stores and seven franchises.
Overall, the group's retail revenues increased by only 1.7 percent to €414 million. Instead, the wholesale business generated turnover of €184.9 million, or 13.5 percent more than in 2006. Furthermore, the revenues of franchised opticians and of the licensees of De Rigo's Police brand improved by 8.4 percent to nearly €97 million.
Company officials point to Ermenegildo Zegna as one of the strongest brands now in De Rigo's portfolio, particularly in Italy, Spain, the Americas and China. Sales under the brand, which now represents 8 percent of its wholesale revenues, went up by 25 percent in 2007.
Operating profit before amortization and depreciation (EBITDA) increased slightly to €64.2 million or 11 percent of revenues. Instead, the operating profit (EBIT) and net income declined, due in part to high investments of €26 million on data processing, retail expansion and the opening of new foreign subsidiaries in Croatia and Brazil. The EBIT went down to €35.2 million from €36.7 million, and the net profit fell to €14.1 million from €24.2 million, partly also because of less favorable taxation and fewer extraordinary gains.
De Rigo says it has extended two eyewear licensing deals ahead of time. The agreement with Escada will run until 2013 and the one with Chopard until 2015.