Prada Profit Surges, Dismisses Economic Concerns

The company's CEO says the industry needs to be 'less hysterical'

By Christopher Freeburn, InvestorPlace Writer

Europe is in an economic crisis, U.S. growth remains sluggish and Asia may be teetering on the brink of a slowdown, but luxury goods maker Prada (PINK:PRDSFisn’t worried.

Responding to downbeat economic forecasts, Patrizio Bertelli, the Italian fashion house’s CEO, said that luxury product makers needed to “stay calm and be less hysterical,” Reuters noted.

Lagging Luxury Signals Global Troubles
Lagging Luxury Signals Global Troubles

Prada announced that its earned 286.4 million euros during the first six months of the fiscal year, up almost 60% over last year. But that missed the $290.3 million euros forecast by analysts. Revenue during the period was 1.55 billion euros.

The company saw the largest growth in Asia. Sales in China rocketed up 50.2%, hitting 334.6 million euros. It’s shares have soared 71% on the Hong Kong stock exchange so far this year.

After opening 28 new stores and closing two existing stores, the Prada has 414 company-controlled stores.

Other luxury apparel makers, including Burberry (PINK:BURBY) have warned of cooling sales growth in China. Bertelli said that based on August and September sales, he expected Prada to match sales targets, and predicted double-digits sales growth at stores open more than twelve months.

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