Italian fashion house Prada SpA on Friday reported a record quarterly profit that beat analysts' estimates, as strong sales of its main product line in Asia helped offset weaker spending in Europe.
The maker of luxury bags and Miu Miu-brand dresses posted a net profit of 217.1 million euros ($279 million) for its fourth quarter ended Jan. 31, up from 158.8 million euros a year earlier.
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That topped analysts' forecast of 202 million euros according to Thomson Reuters I/B/E/S.
Milan-based Prada, which competes with LVMH's Louis Vuitton and PPR's Gucci, has been strengthening its position in the Asian luxury market, particularly in Greater China.
A crackdown on corruption and ostentatious spending in China from the second half of 2012 has dampened sentiment for conspicuous brand names. But Prada's top product line, which regularly unveils new collections, has managed to stay in vogue and avoid brand weariness among consumers.
The Hong Kong-listed company is also expanding in markets such as the Middle East and the Americas. Prada says it still has ample room for growth in emerging markets where it has a smaller presence compared with rivals like LVMH and Salvatore Ferragamo.
Sales in Europe have continued to grow but at a weaker clip than in Asia. Overall revenue climbed 29% to 3.3 billion euros in 2012, led by the Asia-Pacific region, which accounted for 35.6% of group sales versus 34.6% in 2011.
The greater China region which includes mainland China, Hong Kong and Macau - generated net sales of 735.6 million euros, up 35% from 2011, the company said.
Milan-based Prada is seen as a proxy for the booming luxury goods market in Asia, especially in Greater China.
Shares of Prada, which more than doubled in 2012, are up 4% so far this year, outperforming a 4% fall in the benchmark Hang Seng Index. The company has a market value of about $26 billion.
For 2012, total net profit came to 625.7 million euros ($804 million), up 45% from 431.9 million euros in the prior year, and compared with analysts' expectations of 639 million euros, according to Thomson Reuters I/B/E/S. ($1 = 0.7780 euros)