Brunello Cucinelli Reports Solid Performance in First Nine Months

Brunello Cucinelli RTW Spring 2022 — Brunello Cucinelli, spring 2022 Courtesy of Brunello Cucinelli

MILAN — While 2021 may one of “rebalance” for Brunello Cucinelli, the always-philosophical entrepreneur also admitted that it has been a “golden year.”

With the luxury brand seeing a 32.7 percent increase in revenues for the first nine months of the year over a year earlier, Cucinelli also has lots of plans in place to sustain its momentum. One is an investment in a former industrial space covering eight hectares, or about 540,000 square feet, that will allow him to expand the company. The project is expected to be completed in 2024 and is in sync with Cucinelli’s 10-year goal to double sales compared with 2018.

“We will start cleaning up the site next year and gradually invest in the location, which will be devoted to production,” Cucinelli said Thursday.

Then there is significant project in Solomeo, the medieval hamlet he has restored over the years and that is the base of his operations, which will “provide a future for the next 100 years, at least,” Cucinelli said. His family foundation will reveal the details at an event on Oct. 28.

During a conference call with analysts on Thursday at the end of trading in Milan, Cucinelli teased these upcoming projects, which are a source of pride — and some angst. The latter is caused by a speech that he is slated to give at the end of the month in “a very important international forum” on the topics of human sustainability and humanistic capitalism — two of the topics the businessman has long focused on and discussed. No additional details were provided as he said he was not at liberty to reveal them yet.

He was pleased to talk about his brand’s revenues in the first nine months, which amounted to 502.6 million euros, up 9.4 percent compared to the end of September 2019. Compared to the end of September 2020, sales climbed 32.7 percent. In the third quarter of 2021, sales totaled 188.8 million, up 12.5 percent compared to the same period in 2019. The performance was compared to 2019, seen as more meaningful, given the impact of the COVID-19 pandemic last year.

“The first nine months of the year have gone very, very well indeed,” said Cucinelli, who holds the role of executive chairman and creative director. He said the fall collections “are proving very successful worldwide and everywhere we are seeing a strong desire to return to physical stores. We honestly couldn’t have imagined such an excellent result just a year ago. All this leads us to envisage that we will end the current year with a wonderful 25 percent growth in turnover compared to 2020.”

For next year, Cucinelli said he expects 10 percent growth in sales.

In the nine months ended Sept. 30, sales in Europe rose 31.6 percent to 151.4 million euros compared with 2020 and 14.1 percent compared to 2019, lifted by a loyal customer base. In September, Cucinelli cut the ribbon on his New Bond Street store in Mayfair, and also picked up the British GQ Designer of the Year award, which he proudly referred to several times during the call.

Revenues in Italy climbed 21 percent to 70.8 million euros compared with last year and fell 6.9 percent compared with 2019, which “implies a growth of the domestic component of demand, in the absence of a marked recovery of the flow of tourism,” said Cucinelli.

Sales in the Americas rose 37.4 percent to 161.2 million euros compared with 2020 and 7.9 percent compared with 2019. Cucinelli pointed to a balanced distribution in both larger and mid-sized cities as well as resort towns and of monobrand boutiques and department stores and specialty stores. “Travel within the American continent continues and we are pleased to note that the U.S. customer is the first to approach international travel again, favoring in particular European resorts and major fashion capitals.”

In Asia, Mainland China fully confirmed the “excellent” performance seen in the first part of the year. Revenues in Asia climbed 35.9 percent to 119 million euros compared with 2020 and grew 18 percent compared with 2019.

Cucinelli touted a strong local organization and the “growing conviction of the customer, more and more informed and demanding, in the search for a no logo product and sober offer as an element of personal affirmation and differentiation.” Responding to an analyst, he said he did not see a slowdown in China, on the contrary, “a huge future” in the region, “but you need to know and respect their culture.” To this end, the company holds courses to learn about Chinese culture.

Cucinelli admitted some volatility remained in Asia during the last quarter, including in Japan.

The retail channel accelerated its growth trend. In the first nine months of 2021, retail was up 15.6 percent to 264.8 million euros, compared to 2019. Retail sales jumped 56.5 percent compared to last year. There are 113 retail boutiques globally, compared to 107 boutiques at the end of September 2020, and 42 directly managed shops within department stores, compared with 31 at the end of September last year.

In a few weeks, Cucinelli will unveil the newly expanded flagship on Madison Avenue in New York.

The wholesale channel reached sales of 237.7 million euros, up 3.3 percent compared with the same period in 2019, and up 13.5 percent compared with 2020.

Cucinelli did not bemoan issues with raw materials and touted the importance of reusing product, creating designs that will last in time. Once again, he highlighted the relevance of “good taste,” praising Ralph Lauren as a master in this sense.