Luxottica is on the prowl again. After putting its acquisition campaign in standby mode following the management changes the company underwent in the second half of last year, the Italian group is ”scanning” the market and has started talks with potential targets, according to one of its top managers. The group could make an announcement in the next six to 12 months.
In a conference call with financial analysts, Luxottica's new co-chief executive in charge of markets, Adil Mehboob-Khan, said that the group can achieve its growth objectives organically but is also ready to carry out “meaningful and strategic” acquisitions thanks to its strong cash position. The group is interested in acquisitions that would reinforce its position in emerging markets or enable it to learn new skills, citing the example of the online glasses.com platform, bought by Luxottica last year.
Khan also noted that Luxottica already has a strong brand portfolio that covers all market segments. Any new acquisition would be done to gain penetration in a segment, he added.
An acquisition would not exclude the group continuing with its generous dividend policy. As reported, Luxottica is due to pay this month an extraordinary dividend of €0.72 per share, on top of an ordinary dividend of €0.72, on its 2014 results. The overall dividend payment represents a 122 percent increase from the €0.65 ordinary dividend paid the previous year. The payout amounts to €687 million and corresponds to all the group's adjusted 2014 net profits.
Meanwhile, Luxottica says it intends to invest about €200 million a year in its retail business over the next five years, or a total of around €1 billion. The company is working on a new format for LensCrafters, which last had an upgrade about eight to nine years ago. It is currently testing a couple of models and a choice will be made within a couple of months. The new format will be launched in North America by the end of this year, but the revamp will apply to all LensCrafters stores across the world, including China.
The investment plan also concerns the Australian retailer OPSM and Sunglass Hut, which is slated to open 1,000 stores over three years especially in emerging markets