Financial Performance - PRADA Group reported a revenue increase of 20% year-over-year for the first half of 2022, reaching €1.5 billion[2]. - The company achieved a net profit of €300 million, representing a 25% increase compared to the same period last year[2]. - For the six months ended June 30, 2022, the net revenue reached €1,900,942 thousand, representing a significant increase from €1,501,006 thousand in the same period of 2021, marking a growth of 26.6%[29]. - The net income for the group was €188,264 thousand, reflecting a 93.8% increase from €97,243 thousand in the previous year, showcasing strong profitability growth[30]. - The financial net profit for the first half of 2022 was €179,479 thousand, a decrease from €237,653 thousand in the same period of 2021, representing a decline of approximately 24.4%[83]. - The company reported a comprehensive income of €188,264,000 for the first half of 2022, compared to €282,991,000 in the same period of 2021[122]. - The company reported a basic and diluted earnings per share of €0.074, up from €0.038 in the previous year[116]. Sales and Market Expansion - User data indicated a 15% growth in active customers, with a total of 2 million new customers acquired in the first half of 2022[2]. - PRADA plans to expand its retail presence by opening 30 new stores globally by the end of 2022[2]. - The company plans to expand its retail footprint by opening 20 new stores globally in 2023[26]. - PRADA's luxury goods segment saw a 30% increase in sales, driven by strong demand in the Asia-Pacific region[2]. - The company is exploring potential acquisitions to enhance its market position in Asia[2]. - The company anticipates continued growth in the luxury market, projecting a 5% to 7% increase in overall sales for the next fiscal year[26]. E-commerce and Digital Strategy - PRADA's e-commerce sales grew by 35%, contributing significantly to overall revenue growth[2]. - Prada's e-commerce sales grew by 30%, highlighting the shift towards online shopping among consumers[26]. - The company is focusing on enhancing its digital marketing strategies to engage younger consumers, aiming for a 25% increase in social media engagement[26]. - The group has entered the Web 3.0 space by launching exclusive limited-edition products with non-fungible tokens (NFTs), marking a strategic move into digital innovation[34]. Sustainability Initiatives - PRADA is focusing on sustainability initiatives, aiming for a 50% reduction in carbon emissions by 2025[2]. - Prada is investing in new product lines, including a sustainable collection that aims to reduce environmental impact by 25%[26]. - The company has established a Sustainability Committee to oversee its long-term sustainable development initiatives[91]. Operational Efficiency - Adjusted EBIT for the same period was €330,802 thousand, which is 17.4% of net revenue, compared to €165,904 thousand or 11.1% in the prior year, indicating a substantial improvement in operational efficiency[31]. - The gross profit margin improved to 77.7% for the six months ended June 30, 2022, up from 74.3% in the same period of 2021, indicating enhanced cost management[29]. - The company has set a target to achieve a 10% increase in operating profit margin by the end of 2023[26]. Financial Health and Investments - The net financial surplus was €179,479 thousand, compared to a deficit of €101,814 thousand in the same period of the previous year, indicating improved financial health[32]. - The company is investing €100 million in new product development and technology enhancements to improve customer experience[2]. - The company is exploring potential acquisitions to strengthen its market position in the luxury segment[26]. - The company has maintained a high level of corporate governance standards, ensuring transparency and shareholder rights[89]. Risk Management - The liquidity risk is managed by the board, ensuring available funds and credit lines are sufficient to meet operational needs and obligations[70]. - The company emphasizes a multi-channel strategy integrating product quality and innovative content to align with consumer demand[64]. - The company has implemented measures to enhance cybersecurity, including a comprehensive IT security plan and training programs for employees[77]. Corporate Governance - The board of directors held meetings with a 100% attendance rate during the review period, focusing on the establishment of a sustainability committee and evaluating the independence of non-executive directors[96]. - The statutory auditor committee monitored compliance with applicable laws and regulations, ensuring the adequacy of the company's organizational and accounting structure[98]. - The company has adopted written procedures regulating securities trading by directors, ensuring compliance with the standards set forth in the listing rules[104]. Manufacturing and Supply Chain - Prada Group operates 23 manufacturing facilities in Europe, with 20 in Italy, ensuring quality control through in-house production of prototypes and samples[66]. - The group continues to invest in factory operations and has identified key steps for leather traceability to enhance supply chain transparency[36]. - The company collaborates with approximately 1,000 suppliers and contract manufacturers, with 80% located in Italy, implementing strict quality control procedures for outsourced production[67].

Market Transformation and Growth - The luxury goods market underwent significant transformation in 2021, driven by the pandemic, with a notable increase in the proportion of younger consumers and contributions from digital sales channels [9]. - The company achieved growth through a higher-margin sales mix, elimination of discount promotions, and a streamlined wholesale distribution strategy [9]. - The company’s e-commerce website expansion contributed significantly to growth, primarily driven by new customers [9]. - Investments in retail space and processes improved store productivity, enhancing brand recognition and customer traffic [9]. - The company completed store renovations and set up pop-up installations, which increased foot traffic and optimized retail image [9]. Digital Engagement and Innovation - The digital community engagement was expanded through effective communication campaigns, including the Prada Spring/Summer 2022 fashion show and sponsorship of the 36th America's Cup [10]. - The company joined the Aura consortium, enhancing customer experience through blockchain technology for greater transparency and traceability [10]. - A newly approved digital development blueprint will introduce new information systems, providing a competitive advantage across all distribution and communication channels [10]. Financial Performance - Net sales for the year ended December 31, 2021, reached €1,805.5 million, a 56% increase from €1,189 million in the previous year [12]. - Gross profit margin improved to 61% for the year ended December 31, 2021, up from 50% in 2020 [13]. - EBIT for the year was €460.4 million, representing a significant recovery from a loss of €5.4 million in 2020 [12]. - Net income for the year was €310.7 million, compared to a net loss of €16.2 million in the previous year, marking a substantial turnaround [12]. - Cash flow from operating activities was €460 million, while cash used in investing activities was €48 million [22]. Sustainability and Social Responsibility - The company focuses on sustainable development and social responsibility, which are increasingly important to consumers [9]. - The company communicated its sustainable growth strategy, focusing on three pillars: people, environment, and culture [11]. Corporate Governance - The board of directors consists of 11 members, including 5 executive directors, 1 non-executive director, and 5 independent non-executive directors [30]. - The board is responsible for the overall strategy and financial performance of the company, including sustainability strategies and major transactions [34]. - The board established a sustainability committee in February 2022 to address environmental, social, and governance (ESG) matters [44]. - The company has adopted written procedures regulating securities trading by directors and employees with insider information, with no violations reported in 2021 [29]. Risk Management and Internal Controls - The company has adopted procedures to identify, assess, and manage risks affecting its operations, particularly in response to the COVID-19 pandemic [62]. - The internal audit department provides independent reviews of the internal control and risk management systems, with regular updates to the risk assessment documents [62]. - No significant control deficiencies or failures were identified during the year 2021, indicating effective internal control and risk management systems [62]. Financial Position and Liabilities - As of December 31, 2021, net financial position showed a surplus of €142 million, an increase of €307 million compared to the previous reporting date [20]. - Total financial liabilities amounted to €680.6 million, up from €630.6 million in the previous year [20]. - The debt-to-equity ratio improved to -6.0% as of December 31, 2021, compared to 6.9% in the previous year [16]. - Cash and cash equivalents increased to €396.8 million from €103.3 million year-over-year [20]. Investments and Acquisitions - The acquisition of remaining stakes in two companies in Italy and Romania, along with the acquisition of Filati Biagioli spa, strengthened manufacturing activities [11]. - The company executed stock options to acquire the remaining 10% of Pelletteria Ennepì Srl and 20% of Hipic Prod Impex Srl, achieving full ownership of both companies [132]. - The company completed the acquisition of Filati Biagioli Modesto S.p.A. on June 22, 2021, enhancing its capabilities in cashmere and other fine yarns [133]. Financial Risks and Hedging - The company faces financial risks from currency and interest rate fluctuations due to its international operations [126]. - The company uses hedging contracts to manage risks related to currency and interest rates [126]. - The company has entered into interest rate swaps to hedge against interest rate fluctuations, with a notional amount of €31,167,000 at a fixed rate of 1.457% maturing in May 2030 [152]. Employee Compensation and Governance - The company's compensation policy aims to attract, reward, and retain employees, which is considered key to the group's business success [50]. - A long-term cash incentive plan has been adopted for executive directors and senior management, contingent on achieving economic targets over a three-year period [51]. - The Compensation Committee held three meetings in 2021 with a 100% attendance rate to review and recommend the total basic salary for the board of directors [49]. Financial Reporting and Compliance - Prada spa's financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS) effective as of December 31, 2021 [85]. - The company has implemented new and revised IFRS standards effective from January 1, 2022, including IFRS 3 on business combinations and IAS 16 on property, plant, and equipment [88]. - The company recognizes a COVID-19 related rent concession of €5.9 million in the income statement, which is not significantly related to the revisions made in 2021 [87].

Financial Performance - Prada Group reported a significant increase in revenue, achieving €3.2 billion in 2021, representing a 41% growth compared to the previous year[1]. - Net sales for the year ended December 31, 2021, reached €3,316,620 thousand, a significant increase from €2,390,866 thousand in 2020, representing a growth of 38.7%[76]. - The net income attributable to the group for 2021 was €294,254 thousand, a recovery from a loss of €54,139 thousand in 2020[76]. - The operating income (EBIT) for the same period was €489,484 thousand, which is 14.5% of net sales, compared to only €20,061 thousand (0.8%) in 2020[77]. - Operating cash flow for the year was €750,723 thousand, significantly higher than €262,100 thousand in 2020, reflecting improved operational efficiency[77]. - The gross profit margin improved to 75.7% in 2021, up from 72.0% in 2020, indicating better cost management and pricing strategies[76]. - The financial surplus for 2021 was €237,653 thousand, a significant improvement from a loss of €311,357 thousand in 2020 and €405,544 thousand in 2019[78]. - The total equity attributable to the group shareholders increased to €3,113,894 thousand in 2021, up from €2,832,057 thousand in 2020[78]. - The company reported a basic earnings per share of €0.115 for 2021, recovering from a loss of €0.021 per share in 2020[77]. - The company plans to continue expanding its market presence and investing in new product development to drive future growth[76]. Market Expansion and Strategy - The company plans to expand its retail footprint, targeting a 10% increase in the number of stores globally over the next two years[1]. - Prada Group is exploring potential acquisitions to enhance its brand portfolio and market presence, with a focus on niche luxury brands[1]. - The company has expanded its retail presence in key markets such as Dubai, Paris, and Hong Kong, with 100% ownership in these locations[64]. - The company has a significant retail footprint in Asia, with operations in Vietnam, Taiwan, and South Korea, enhancing its market reach[64]. - Retail sales in the Asia-Pacific region increased by 30.1% compared to 2019 at constant exchange rates, with notable growth in mainland China, South Korea, and Taiwan[84]. - The company completed over 120 store renovations and set up 80 pop-up installations in 2021, enhancing store traffic and brand visibility[80]. Sustainability Initiatives - Prada is investing in sustainable practices, with a commitment to reduce carbon emissions by 30% by 2025[1]. - The company has established a sustainable development strategy with three pillars: people, environment, and culture, approved by the board on November 11, 2021[40]. - Prada has committed to achieving net-zero emissions by 2050, reflecting its long-term sustainability goals[47]. - The company plans to achieve a 42% reduction in Scope 3 emissions by 2029, also based on 2019 levels[47]. - Prada has installed 141 LEED certifications across various projects, enhancing its commitment to sustainable building practices[47]. - The company is transitioning nearly all virgin nylon to recycled nylon through its Re-Nylon initiative, showcasing its dedication to sustainability[49]. - Prada Group achieved a greenhouse gas reduction target of 29% by 2026 for Scope 1 and 2 emissions, based on 2019 levels[47]. Digital Transformation - Prada's e-commerce sales surged by 70%, reflecting a shift in consumer behavior towards online shopping during the pandemic[1]. - The company aims to enhance its digital marketing strategies, allocating 20% of its marketing budget to digital channels in 2022[1]. - Direct e-commerce sales grew by 61% since 2020 and more than fivefold since 2019, accounting for approximately 7% of total retail sales in 2021[84]. - The investment in digital communication channels yielded outstanding results, particularly in online brand engagement metrics[80]. - The company has joined the Aura consortium to enhance customer experience through blockchain technology, ensuring greater transparency and traceability[80]. Corporate Governance and Leadership - Paolo Zannoni was elected as Chairman of the Board on May 27, 2021, and has been an international advisor for Goldman Sachs since 2019[128]. - Miuccia Prada and Patrizio Bertelli serve as co-CEOs, with Miuccia also being the co-creative director of Prada and Miu Miu[129]. - The company emphasizes its commitment to maintaining strong investor relations and financial communication strategies[133]. - The board includes non-executive director Stefano Simontacchi, who has extensive experience in international tax and corporate law[135]. - The company has received multiple awards for its contributions to international fashion, highlighting its innovative vision[130]. Employee and Workforce Management - As of December 31, 2021, Prada Group employed 13,140 people from 107 countries, with women making up 62% of the workforce[41]. - The company emphasizes a performance-linked compensation and benefits system to ensure equality and attract skilled professionals[43]. - Prada Academy serves as a training center to share knowledge and skills, focusing on preserving classic craftsmanship and enhancing employee capabilities[42]. - The company has implemented a long-term plan for disability inclusion, hiring individuals with Down syndrome in its Italian stores[41]. Risk Management - The group faces foreign exchange risks due to its extensive international presence and has established derivative contracts to hedge these risks[112]. - Interest rate risk is managed through derivative instruments, such as interest rate swaps, to convert floating-rate debt into fixed-rate debt[113]. - Credit risk primarily involves trade receivables from wholesale channels, managed through business and financial strategies based on customer creditworthiness and insurance contracts[106]. - The company has enhanced its information system security in response to rising cyberattack risks reported by EU financial market regulators[115]. Cultural and Community Engagement - The Prada Foundation has presented 24 exhibitions in Milan, honoring significant global artists and hosting various cultural events[54]. - The company completed the restoration of the Rongzhai historical landmark in Shanghai in 2017, showcasing its commitment to cultural heritage[53]. - Prada has established a long-term partnership with UNESCO for the "Sea Beyond" project, promoting marine conservation awareness among students[51]. - The Prada Foundation launched the "Human Brains" project, aimed at increasing public interest in neuroscience through exhibitions and discussions, running until 2022[56]. Compliance and Ethical Practices - The company emphasizes compliance with international and local laws, having established an industrial compliance committee in 2010 to oversee product manufacturing and distribution[164]. - The company’s commitment to ethical practices includes ensuring suppliers adhere to high standards and respect employee rights, such as fair working conditions and environmental protection[169]. - Prada's tax strategy focuses on preventing tax risks and ensuring tax stability through ongoing dialogue with tax authorities in operating countries[109].

Financial Performance - PRADA Group reported a significant increase in revenue, achieving €1.5 billion for the first half of 2021, representing a 60% year-over-year growth[2]. - The company reported a net profit of €300 million for the first half of 2021, a significant improvement compared to a loss in the same period last year[2]. - The net income attributable to the group for the six months ended June 30, 2021, was €97,243 thousand, compared to a loss of €180,332 thousand in the previous year[14]. - For the six months ended June 30, 2021, the EBIT was €165.9 million, representing 11.1% of net revenue, a significant improvement from a loss of €195.8 million (-20.9%) in the same period of 2020[54]. - The company reported total comprehensive income of €130,608 thousand for the six months ended June 30, 2021, compared to a loss of €(136,855) thousand for the full year ended December 31, 2020[89]. - The company reported a significant reduction in labor costs to €7 million from €33.8 million in the previous year, reflecting operational efficiency[55]. - The company reported a financial loss of €101,814 thousand for the first half of 2021, an improvement from a loss of €311,357 thousand in the same period of 2020[15]. Sales and Market Performance - The company noted a strong recovery in retail sales, with a 70% increase in comparable store sales compared to the same period in 2020[2]. - PRADA Group's online sales surged by 100%, contributing to 20% of total sales, highlighting the shift towards digital channels[2]. - Retail sales for Prada Group increased by 60.3% in the first half of 2021 compared to the same period in 2020, and by 8.4% compared to 2019, with e-commerce sales reaching nearly 7% of total retail sales[20]. - In the Asia-Pacific region, retail sales rose by 64.9% compared to the same period in 2020, and by 34.9% compared to 2019, with significant growth in mainland China (+77%), Taiwan (+74%), and South Korea (+108%)[22]. - The Americas market saw a robust recovery with retail sales increasing by 163.4% compared to the first half of 2020, and by 52.5% compared to 2019[22]. Operational Strategy - The company plans to expand its retail footprint, targeting an increase of 10% in the number of stores globally by the end of 2022[2]. - PRADA Group is exploring potential acquisitions to enhance its brand portfolio and market presence, particularly in the luxury segment[2]. - The company is actively expanding its retail footprint while also managing underperforming assets through liquidation strategies[8]. - The company plans to continue focusing on product design and development, with costs amounting to €63,736 thousand, representing 4.2% of net sales[13]. - The company is investing in new product lines, with a focus on sustainable materials, aiming for 50% of its collections to be made from sustainable sources by 2025[2]. Financial Health and Liquidity - The total equity of the group as of June 30, 2021, was €2,881,081 thousand, an increase from €2,832,057 thousand at the end of 2020[15]. - The company has secured two ESG-related loans: a €90 million bilateral long-term loan and a €400 million revolving credit facility, enhancing financial flexibility[18]. - The net cash flow from operating activities was €315,602 thousand, a significant turnaround from a negative cash flow of €26,455 thousand in 2020[14]. - Cash and cash equivalents increased to €604.7 million from €442.4 million at the end of 2020[34]. - The company has sufficient liquidity, with available cash and credit lines, to meet operational, investment, debt repayment, and dividend payment needs[45]. Cost Management and Efficiency - Gross profit margin improved to 74.3% in 2021, up from 70.4% in 2020, indicating better cost management and pricing strategies[13]. - The cost of sales was €651,139 thousand, which accounted for 43.4% of net sales, compared to 65.2% in the previous year, indicating improved efficiency[13]. - The total operating expenses amounted to €949,081 thousand, which is 63.2% of net sales, down from 91.3% in the previous year[13]. - Operating income for the same period was €165,904 thousand, with an EBIT margin of 11.1%, a significant recovery from a loss of €195,796 thousand in 2020[14]. Corporate Governance and Compliance - The board of directors consists of nine members, including the chairman Paolo Zannoni and CEO Miuccia Prada Bianchi, with a term lasting until the approval of the financial statements for the year ending December 31, 2023[63]. - The audit committee held four meetings during the review period, with a 100% attendance rate, focusing on the audit plan, internal controls, and financial reporting matters[66]. - The company has adopted written procedures regulating securities trading by directors, ensuring compliance with the standards set out in the Listing Rules[75]. - The group has implemented a centralized governance model to manage regulatory compliance risks arising from complex global frameworks[47]. Sustainability and Social Responsibility - The company has established a training program to support young talents from diverse backgrounds in the fashion industry, emphasizing sustainability and inclusivity[17]. - PRADA Group is investing in new product lines, with a focus on sustainable materials, aiming for 50% of its collections to be made from sustainable sources by 2025[2]. - The group believes its credit risk primarily involves trade receivables and current assets generated from wholesale channels[44]. Future Outlook - The company has set a guidance for full-year revenue growth of 25% to 30%, reflecting confidence in continued market recovery[2]. - Management expressed confidence in maintaining strong sales momentum in the second half of the year, despite uncertainties in the market[59]. - Future guidance suggests a cautious outlook, with an emphasis on managing costs while pursuing growth opportunities in new markets[199].

Financial Performance - Prada Group reported a significant decline in revenue for 2020, with total sales dropping by 24% to €2.42 billion compared to the previous year[1]. - The group's net profit for 2020 was €200 million, a decrease of 70% year-on-year, reflecting the impact of the COVID-19 pandemic on luxury retail[1]. - Net sales for the year ended December 31, 2020, were €2,390.9 million, a decrease from €3,183.3 million in 2019, representing a decline of 25.0%[70]. - EBIT for the year was €20.1 million, significantly down from €306.8 million in 2019, resulting in an EBIT margin of 0.8% compared to 9.5% the previous year[71]. - The net loss for the group was €54.1 million, compared to a profit of €255.8 million in 2019, marking a substantial decline[71]. - Operating cash flow for the year was €262.1 million, down from €362.4 million in 2019, indicating a decrease in cash generation from operations[71]. - The group’s equity attributable to shareholders was €2,832.1 million, down from €2,967.2 million in 2019, showing a decline in shareholder equity[72]. - The company incurred €115.8 million in costs related to store closures during lockdowns, impacting overall financial performance[70]. - The net financial position showed a loss of €311.4 million, an improvement from a loss of €405.5 million in 2019, indicating better financial management[72]. - Total operating expenses amounted to €1,723.3 million, a decrease of €289.5 million compared to the previous year, largely due to rent reductions and government subsidies[84]. E-commerce and Digital Strategy - E-commerce sales surged by 77% in 2020, accounting for 20% of total sales, indicating a shift in consumer purchasing behavior towards online platforms[1]. - The company has implemented new digital marketing strategies to enhance customer engagement and drive sales through online channels[1]. - Significant investments have been made in digital development, strengthening partnerships with top online retailers[42]. - Direct e-commerce sales tripled compared to 2019, indicating a strong shift towards online shopping during the pandemic[79]. - The company redesigned prada.com and miumiu.com for enhanced customer experience[75]. Market Expansion and Retail Strategy - Prada Group plans to expand its retail network, with a focus on opening new stores in key markets, particularly in Asia and the Americas, to enhance brand presence[1]. - The company has expanded its distribution network to 633 directly operated stores in prime locations, enhancing brand visibility and sales performance[42]. - The company closed 20 stores and opened 12, resulting in a total of 633 stores as of December 31, 2020, with 140 stores still closed due to the pandemic[79]. - Retail channel sales accounted for 88.5% of total net sales in 2020, up from 82.8% in 2019[79]. - The Asia-Pacific market showed resilience with retail sales net amounting to a decrease of only 1.1% compared to 2019, while the second half of 2020 saw a 19% increase compared to the same period in 2019[80]. Sustainability and Corporate Responsibility - The company is investing in sustainable production practices, with plans to open a new leather goods factory in Tuscany and refurbish five existing facilities to meet environmental standards[1]. - Prada Group's energy efficiency action plan includes the construction of 10 large photovoltaic power stations and the replacement of all air conditioning and cooling systems with the latest technology[48]. - The company has committed to a fur-free policy and launched the Prada Re-Nylon initiative, aiming to replace virgin nylon with recycled nylon across most of its clothing and leather goods[51]. - Prada Group achieved 58 LEED certifications for its stores and factories by December 31, 2020, with 20 new certifications added in 2020[48]. - The company participated in the Fashion Pact, collaborating with over 60 leading fashion and textile companies to enhance environmental sustainability commitments[51]. Innovation and Product Development - Prada Group is set to launch new product lines, including a collection of sustainable fashion items, to align with growing consumer demand for eco-friendly products[1]. - The company continues to focus on innovation in design and technology, with ongoing research and development efforts to create unique luxury products[1]. - Research and development costs for design and product development amounted to €102.2 million for the year[110]. Leadership and Governance - Miuccia Prada and Patrizio Bertelli are co-founders and current CEOs of the company, with Miuccia serving as the chairperson since November 2003[114]. - The company has a strong governance structure with various committees, including audit and remuneration committees[118]. - The board includes members with significant expertise in international tax, private equity, and mergers and acquisitions[116]. - The company has maintained a consistent leadership team with re-elections occurring in 2018 for key positions[114][116]. - The management team has extensive experience in luxury retail and brand management, enhancing the company's operational capabilities[126]. Employee and Workforce Management - As of December 31, 2020, Prada Group employed 12,858 people from 104 countries, with women making up 62% of the workforce[45]. - The average number of employees decreased to 13,331 from 13,779 in the previous year, reflecting a reduction in workforce[71]. - The company emphasizes diversity and inclusion, establishing a cultural diversity advisory committee in 2019 to enhance management's focus on social sustainability[45]. - Prada Academy serves as the training center to cultivate talent and ensure the preservation of craftsmanship knowledge and skills[46]. Financial Management and Risk - The company has established a tax risk management system, participating in the OECD's International Compliance Assurance Program (ICAP) to mitigate potential tax risks[102]. - The group has achieved "Authorized Economic Operator" (AEO) status, enhancing operational efficiency and reducing average transfer times for raw materials and finished goods[103]. - The company has implemented measures to protect data privacy and ensure compliance with applicable laws and regulations, minimizing data processing risks[104]. - The group actively protects its brand and intellectual property through legal registrations and collaborations with customs and law enforcement agencies[97]. - The company has established a systematic communication channel with tax authorities to reduce uncertainties related to tax compliance[102].

Revenue Performance - PRADA Group reported a significant decline in revenue, with a decrease of 40% year-over-year for the first half of 2020[1]. - The company experienced a drop in retail sales by 50% in the second quarter compared to the previous year, primarily due to the impact of COVID-19[1]. - PRADA reported a significant increase in retail sales, with a growth rate of 20% year-over-year in the last quarter[8]. - Net revenue for the six months ended June 30, 2020, was €937,657 thousand, a decrease of 40.3% compared to €1,570,123 thousand for the same period in 2019[13]. - Net revenue for the six months ended June 30, 2020, was €925.3 million, a decrease from €1,546.4 million for the same period in 2019, representing a decline of approximately 40.2%[165]. E-commerce and Digital Strategy - E-commerce sales surged, increasing by 80% in the first half of 2020, indicating a shift in consumer purchasing behavior[1]. - PRADA plans to expand its digital presence and enhance online shopping experiences as part of its future strategy[1]. - PRADA's e-commerce sales grew by 30%, contributing to 25% of total sales, highlighting a strong digital strategy[8]. - E-commerce sales increased more than 100% compared to the first half of 2019, despite a low absolute base[21]. Financial Outlook and Management - PRADA has outlined a cautious outlook for the second half of 2020, expecting a gradual recovery in sales as markets reopen[1]. - The company plans to focus on cost management and operational efficiency in response to the challenging market conditions[12]. - The company is investing in new technologies to improve supply chain efficiency and customer engagement[1]. - The company plans to invest €100 million in new product development and technology enhancements over the next two years[8]. - The company believes that growth will gradually resume by the end of 2020 as the store network fully reopens, with strong local consumer response confirming demand for its products[51]. Losses and Financial Performance - Operating loss (EBIT) for the period was €(195,797) thousand, compared to an operating income of €150,474 thousand in the prior year[13]. - Net loss attributable to the group was €(180,332) thousand, a significant decline from a net income of €154,894 thousand in the same period last year[13]. - The company reported a net loss of €183,515,000 for the six months ended June 30, 2020, compared to a net income of €154,431,000 for the same period in 2019[80]. - The company reported a net loss of €180.3 million for the period, compared to a net income of €255.8 million for the same period in the previous year[158]. Cost Management and Operational Efficiency - The company incurred direct costs of €112,375 thousand related to store closures during the lockdown period[13]. - Operating expenses totaled €856.1 million for the six months ended June 30, 2020, representing 91.3% of net sales, up from 62.1% in the same period of 2019[167]. - The company is currently unable to foresee trade developments for the coming months due to uncertainty, but if recent retail trends continue positively, it may return to profitability in the second half of 2020[51]. Sustainability and Innovation - The company is focusing on sustainable practices and aims to launch new eco-friendly product lines in the upcoming quarters[1]. - The luxury brand is focusing on sustainability, with 40% of new products made from eco-friendly materials[8]. - PRADA's management emphasized the importance of innovation and creativity in driving future growth[1]. Market Position and Acquisitions - PRADA is exploring potential acquisitions to strengthen its market position and diversify its product offerings[1]. - The company is exploring potential acquisitions to enhance its product portfolio and market reach[8]. - The brand is committed to maintaining its luxury positioning while adapting to changing consumer preferences[1]. Employee and Management Changes - The average number of employees remained stable at 13,669, compared to 13,618 in the previous year[14]. - New appointments in key management positions were made to strengthen long-term growth strategies despite the ongoing challenges[18]. Financial Position and Liquidity - The group secured a €300 million revolving credit facility for 24 months to ensure liquidity, increasing available credit to €748 million[18]. - The company believes its liquidity and credit lines, along with operational and financing activities, are sufficient to meet operational working capital, investment activities, timely debt repayment, and dividend payments[45]. - The company had an unused credit line of €748 million as of June 30, 2020, providing additional financial flexibility[36]. Risk Management and Compliance - The company manages credit risk primarily through monitoring customer reliability and solvency, as well as through insurance agreements[44]. - The company has implemented a tax risk management system that is continuously monitored to mitigate risks arising from regulatory non-compliance or misinterpretation of laws[45]. - The company emphasizes the importance of maintaining compliance with complex regulatory environments to mitigate legal and regulatory risks[46]. Corporate Governance - The company’s management is committed to maintaining high standards of corporate governance, aligning with applicable regulations in Italy and the Hong Kong Stock Exchange[53]. - The Audit Committee held three meetings during the review period with a 100% attendance rate, focusing on financial reporting and risk management[56]. Shareholder Information - As of June 30, 2020, Miuccia Prada Bianchi and Patrizio Bertelli each hold 2,046,470,760 shares, representing an 80% ownership stake in the company[67]. - PRADA Holding S.p.A. is the controlling shareholder, owning approximately 80% of the issued share capital[75]. Market Trends and Consumer Behavior - The luxury goods market is influenced by consumer preferences and macroeconomic conditions, which may negatively impact the group's operations and financial status[39]. - The success of the group relies on its ability to predict fashion trends and consumer preferences, supported by a team of approximately 1,000 professionals in design and development[40].

Financial Performance - The net sales for the year ended December 31, 2019, were €1,780,423 thousand, an increase of 5% from €1,691,476 thousand in the previous year[12]. - The gross profit margin remained stable at 53.8%, while operating expenses as a percentage of net sales increased, leading to a slight decline in EBIT from 11.8% to 11.3%[13]. - The net income for the period was €249,027 thousand, representing a 13.7% increase compared to €708,548 thousand in the previous year[12]. - The EBITDA for the year was €307,897 thousand, reflecting a growth of 16.8% from €265,084 thousand in the previous year[12]. - The total equity as of December 31, 2019, was €2,016,425 thousand, compared to €1,914,992 thousand in the previous year[15]. - The debt-to-equity ratio increased to 7.6% from 6.6% in the previous year[15]. - The company paid dividends totaling €153.5 million during the year[17]. - The company reported a net income of €249,027,388 for 2019, a significant decrease from €708,548,197 in 2018, representing a decline of approximately 64.9%[72][73]. - The company’s equity increased to €2,016,425,204 in 2019 from €1,914,992,188 in 2018, reflecting a growth of about 5.3%[71]. Strategic Initiatives - The company achieved significant results in its long-term growth objectives, driven by global consumer demand for innovation and excellence[10]. - The decision to eliminate discount sales in direct-operated stores and rigorously select wholesale buyers improved product value and pricing control, leading to positive retail growth[10]. - The launch of the "Prada Invites" and "Prada for adidas Limited Edition" capsule collections highlighted the symbolic value of products and established important business alliances[10]. - The company invested in enhancing its brand image and store network, acquiring Fratelli Prada in Milan to gain full control over its global retail network[11]. - Significant progress was made in sustainability, with the introduction of the "Prada Re-Nylon" capsule collection and a commitment to reduce the fashion industry's environmental footprint[11]. - The company focused on consumer interaction through a comprehensive communication plan, ensuring broad coverage of product and brand messaging[10]. - New versions of "Prada Mode" were launched in Hong Kong and London, promoting contemporary culture through a mobile club concept[10]. - The company established key partnerships with leading technology suppliers to assist in marketing and procurement processes[11]. Financial Position and Cash Flow - The net working capital increased to €230,738 thousand, up by €52,892 thousand from €178,846 thousand in the previous year[17]. - The net financial position as of December 31, 2019, was a deficit of €189,116 thousand, compared to a deficit of €136,131 thousand in the previous year[17]. - Cash flow from operating activities was €201 million, while cash used in investing activities was €63 million[21]. - The company has a total available credit line of €574 million as of December 31, 2019, compared to €497 million at the end of 2018[20]. - The company anticipates a negative impact on its performance for the current year due to the COVID-19 outbreak, despite a positive start to 2020[23]. Governance and Board Structure - The board consists of nine directors, including four executive directors, one non-executive director, and four independent non-executive directors[29]. - The board held four meetings during the review period, with an average attendance rate of 83.3%[30]. - The audit committee and nomination committee had attendance rates of 94.4% and 100%, respectively[33]. - The board is responsible for the overall strategy and financial performance of the company, including major transactions and acquisitions[34]. - Independent non-executive directors have confirmed their independence according to applicable listing rules[36]. - The company has arranged appropriate liability insurance for directors, which is reviewed annually[37]. - Directors undergo comprehensive training upon appointment to understand the company's business and their responsibilities[38]. - The chairman is Carlo Mazzi, while Miuccia Prada Bianchi and Patrizio Bertelli serve as co-CEOs, with the roles being independent[39]. Audit and Compliance - The audit committee held six meetings during the review period with an attendance rate of 94.4% to review significant internal and external audit results[44]. - The total fees for the auditor Deloitte & Touche S.p.A. for the period ending December 31, 2019, amounted to €714,000, including €500,000 for audit services and €214,000 for other consulting services[46]. - The audit committee's responsibilities include providing independent opinions on the effectiveness of the company's financial reporting procedures and internal control systems[44]. - The company reviews compliance with governance codes and monitors internal control and risk management systems through the audit committee[41]. - The board has established various committees, including the audit committee, compensation committee, and nomination committee, with independent non-executive directors as chairs[42]. Risk Management - The company faces financial risks such as exchange rate and interest rate fluctuations due to its international operations, and it employs hedging contracts to manage these risks[117]. - The fair value of hedging derivatives for interest rate risk is recorded in equity, net of tax effects[119]. - The company’s risk management activities include derivative contracts to mitigate financial risks arising from currency and interest rate fluctuations[134]. - The company has entered into contracts to hedge anticipated future trade cash flows totaling €763,629 thousand as of December 31, 2018, with a significant portion in foreign currencies such as USD and CNY[138]. - The company has established interest rate swaps to hedge against interest rate fluctuations related to loans, with agreements in place as of December 31, 2019[141]. Investments and Assets - The company’s total financial assets amounted to €1,363,325 thousand as of December 31, 2019, with derivative financial instruments valued at €10,854 thousand[145]. - The total value of property, plant, and equipment as of December 31, 2019, was €805,677 thousand, up from €766,699 thousand in 2018, indicating a growth of 5.1%[168]. - The total intangible assets' net book value as of December 31, 2019, was €194.6 million, with significant components including trademarks and software[172]. - The company’s investment in Kenon Limited remained stable at €99,478 thousand, with no changes reported during the year[177]. - The company conducted impairment tests on investments showing signs of impairment, with a discount rate (WACC) used ranging from 4.2% to 12.6% for the year ended December 31, 2019[179]. COVID-19 Impact - The company noted that the impact of COVID-19 was not included in the business plan forecasts, as it occurred after the reporting date, indicating potential future risks[179]. - The impact of the COVID-19 pandemic on the financial statements remains uncertain and will continue to be monitored throughout the fiscal year[121].

Financial Performance - Prada Group reported a significant increase in sales, achieving a total revenue of €3.2 billion, representing a growth of 8% compared to the previous year[1]. - The company reported a net profit of €400 million, reflecting a profit margin of 12.5%, which is an improvement from the previous year's margin of 11%[1]. - PRADA reported a significant increase in revenue, achieving €3.2 billion in the first half of 2023, representing a 15% year-over-year growth[68]. - The company expects a continued positive trend, projecting a revenue growth of 10-12% for the full year 2024[68]. - The gross margin improved to 70%, up from 68% in the previous year, reflecting better cost management and pricing strategies[68]. - The net income for 2019 was €257,724 thousand, an increase of 31.1% from €196,384 thousand in 2018[111]. - Total net sales amounted to €3,183,339, reflecting a 2.8% growth year-over-year[79]. Retail Expansion - The company noted a 12% increase in retail sales, driven by strong performance in Asia and the Americas, with Asia accounting for 40% of total sales[1]. - Prada Group plans to expand its retail footprint by opening 30 new stores globally in the upcoming year, focusing on key markets such as China and the United States[1]. - PRADA plans to expand its retail footprint by opening 30 new stores globally in 2024, focusing on key markets such as the Middle East and North America[68]. - Prada operates 641 directly operated stores in prime locations of major international shopping centers, contributing to 82.8% of total sales from retail channels[36]. - The number of stores increased to 641, with 22 new openings and 21 closures, including 4 stores acquired in Milan[81]. E-commerce and Digital Strategy - Prada Group's e-commerce sales grew by 25%, highlighting the increasing importance of online channels in their overall strategy[1]. - The company reported a 12% increase in e-commerce sales, highlighting the growing importance of online channels[68]. - The company integrates its direct stores with e-commerce strategies to monitor sales performance in different markets in real-time[36]. - Prada has established significant partnerships with major online retailers to enhance its digital presence and e-commerce capabilities[42]. Sustainability Initiatives - The company is investing in new product lines, including a sustainable collection that aims to reduce environmental impact, with a target of 20% of total sales coming from sustainable products by 2025[1]. - PRADA has successfully launched a new sustainable product line, which accounted for 5% of total sales in the first half of 2023[68]. - The company emphasized its commitment to sustainability, aiming for 100% of its products to be made from sustainable materials by 2025[68]. - The Prada Re-Nylon campaign aims to fully replace virgin nylon with regenerated nylon, reflecting the company's commitment to a better environment[50]. - The group has made significant progress in sustainability, including the introduction of the "Prada Re-Nylon" capsule collection and signing the Fashion Pact to reduce the industry's environmental footprint[76]. Innovation and Product Development - The company is investing €150 million in new product development and technology enhancements to improve customer experience and operational efficiency[68]. - Prada Group is committed to innovation, with plans to invest €100 million in technology and digital transformation over the next three years[1]. - Creativity is at the core of the manufacturing process, with Miuccia Prada's innovative ideas and social awareness driving the design culture within the company[34]. - The launch of the "Prada Invites" and "Prada for adidas Limited Edition" capsule collections highlighted the brand's commitment to innovation and collaboration[75]. Human Resources and Workforce - Prada has a workforce of 13,988 employees from 105 countries, with women making up 62% of the total[43]. - The average tenure of production staff at Prada is 20 years, ensuring high levels of specialization and knowledge accumulation[35]. - The company has implemented a supplier audit program to control risks related to human rights violations and poor working conditions[45]. - Prada's retail training programs focus on enhancing professional skills and product knowledge, contributing to customer service excellence[44]. Corporate Governance and Compliance - The board of directors is responsible for preparing the consolidated financial statements, ensuring they reflect the group's business status fairly and accurately[177]. - The independent auditor, Deloitte & Touche S.p.A., has been reappointed for a term of three fiscal years, ensuring compliance with Italian law regarding auditor appointments[178]. - The company has a legal and regulatory compliance framework in place to mitigate risks associated with its global operations[140]. - The group participates in the OECD's International Compliance Assurance Program (ICAP), sharing extensive data with tax authorities in Italy, the US, the UK, Canada, and Australia[105]. Cultural and Artistic Engagement - The Fondazione Prada continues to host diverse cultural events and exhibitions, showcasing the company's commitment to art and culture[55]. - Recent projects include the restoration of a historic residence in Shanghai, transforming it into a multifunctional cultural venue[51]. - Prada's ongoing cultural initiatives include educational programs and workshops, furthering its engagement with the arts community[55]. - The company produced 18 short films titled "Miu Miu Women's Stories" by various renowned directors as of December 2019, showcasing its commitment to contemporary art[61]. Financial Management and Risk - The company faces economic risks that could negatively impact its operations, performance, cash flow, and financial condition due to global macroeconomic factors[97]. - The liquidity risk management strategy includes maintaining sufficient cash and credit lines to meet operational needs, repay loans, and pay dividends on schedule[103]. - The group manages credit risk primarily related to trade receivables and current assets, monitoring customer reliability and solvency through insurance agreements[103]. - The company has implemented a long-term incentive plan to retain key personnel essential for its expansion in the fashion and luxury goods sector[101].

Financial Performance - PRADA Group reported a significant increase in revenue, achieving €1.5 billion for the first half of 2019, representing a 10% growth compared to the same period last year[2]. - Net revenue for the six months ended June 30, 2019, was €1,570,123 thousand, an increase from €1,535,326 thousand for the same period in 2018, representing a growth of 2.3%[13]. - The net income attributable to the group for the first half of 2019 was €154,894 thousand, a significant increase from €99,457 thousand in the prior year, reflecting a growth of 55.8%[14]. - The company reported a net income of €154,431 thousand for the six months ended June 30, 2019, compared to €98,953 thousand for the same period in 2018, representing a 56.3% increase[48]. - The group reported a net income of €154,893,688 for the six months ended June 30, 2019, compared to €105,668,240 for the same period in 2018, marking an increase of 46.5%[172]. - The company reported a net income of €205,443 thousand, down from €217,721 thousand in 2018, showing a decrease of about 5.9%[189]. Sales and Market Performance - The company experienced a 12% increase in retail sales, driven by strong performance in Asia and the Americas, with Asia accounting for 40% of total sales[2]. - PRADA's e-commerce sales grew by 25%, now representing 15% of total sales, indicating a strong shift towards online retail[2]. - Retail sales in Europe reached €598,364 thousand, accounting for 38.7% of total sales, with a 6.3% increase from €563,003 thousand in the previous year[18]. - The Asia-Pacific region saw a decline in sales, totaling €498,578 thousand, which is a 4.0% decrease from €519,594 thousand in the prior year, representing 32.2% of total sales[18]. - The net sales in the Asia-Pacific market decreased by 4% at current exchange rates and 6.4% at constant exchange rates, with Greater China generating net sales of €336.6 million, down 2.3% at current rates and 5.1% at constant rates[21]. - The net sales in Europe increased by 6.3% at current exchange rates and 6.5% at constant exchange rates, with wholesale sales growth contributing positively to the region[21]. Cost and Margin Analysis - PRADA's gross margin improved to 70%, up from 68% in the previous year, reflecting better cost management and pricing strategies[2]. - The gross margin slightly narrowed from 72% to 71.7%, impacted by sales mix dilution, although this was mitigated by a better ratio of full-price to discounted sales[25]. - The cost of sales represented 28.3% of net revenue, compared to 28.0% in the previous year, indicating a slight increase in cost efficiency[13]. - Operating expenses increased to €975,275 thousand, accounting for 62.1% of net revenue, compared to 61.6% in the prior year[77]. Strategic Initiatives and Investments - The company plans to expand its retail network by opening 20 new stores globally in 2020, focusing on key markets such as China and the United States[2]. - PRADA is investing in new product lines, including a sustainable collection that is expected to contribute an additional €100 million in revenue by the end of 2020[2]. - The company has allocated €50 million for research and development in innovative materials and technologies to enhance product offerings[2]. - The company is exploring potential acquisitions to enhance its market position and diversify its product portfolio[2]. - The company is focused on sustainability and ethical practices in its production processes, aligning with global consumer trends towards responsible luxury[8]. Operational and Workforce Insights - The average number of employees increased to 13,618 from 13,044 year-over-year, indicating a growth in workforce[14]. - The company operates a comprehensive distribution and retail network across multiple regions, including the Middle East, Europe, Asia, and the Americas, with 100% ownership in many subsidiaries[8]. - The company has established a diverse portfolio of brands and services, including retail, production, and logistics, enhancing its operational capabilities[8]. Financial Position and Cash Flow - The net financial position showed a deficit of €506,634 thousand, worsening from a deficit of €313,505 thousand at the end of 2018[15]. - Operating cash flow for the first half of 2019 was €137,334 thousand, down from €180,018 thousand in the same period of 2018[14]. - Cash and cash equivalents totaled €327.5 million as of June 30, 2019, down from €599.8 million at the end of 2018[32]. - The total lease liabilities decreased from €2,449 million on January 1, 2019, to €2,419 million on June 30, 2019, due to payments made during the period[33]. Risk Management and Compliance - The group faces global macroeconomic risks that could negatively impact luxury goods consumption patterns and, consequently, its operations, performance, cash flow, and financial condition[35]. - The company is actively managing foreign exchange risks through derivative contracts to hedge against currency fluctuations affecting revenues and expenses[45]. - The company has established a tax risk management system that allows for open communication with Italian tax authorities, helping to minimize business risks[42]. - The company faces various legal and regulatory risks due to its complex operating environment, including compliance with securities listing rules and occupational health and safety regulations[44]. Corporate Governance and Shareholder Information - The company proposed a final dividend of €0.06 per share for the fiscal year 2018, totaling €153,529,440, which was approved by shareholders on April 30, 2019[62]. - As of June 30, 2019, Prada Holding S.p.A. holds approximately 80% of the company's issued share capital, representing a significant controlling interest[73]. - The company has established a statutory auditor committee to oversee compliance with applicable laws and regulations[60]. - The board of directors has adopted a dividend policy aimed at providing sustainable dividend flows while considering cash flow and profitability[62].