After a “strong start” to 2022, Italian luxury fashion brand Prada maintained its growth targets for the medium term , while the luxury firm also acknowledged that the situation in Ukraine would make any projections questionable.

Following the European Union and many other nations imposing tough economic sanctions on Russia in reaction to Moscow’s invasion of Ukraine, Prada said earlier this month that it has discontinued its retail activities in Russia, joining a wave of other famous companies. 

Prada said on Monday that Russia contributed for about 2% of its worldwide sales in 2021.

EBIT increased to 489 million euros ($535.85 million) in 2021, up from 20 million euros a year earlier and significantly above the 307 million achieved in 2019, before the Covid-19 pandemic. 

According to a Refinitiv, a consensus estimate of analysts predicted a 429 million euro operational profit.

“Prada Group’s start to 2022 has been strong. Our long-term strategy is on track,” CEO Patrizio Bertelli said in a statement adding he was confident to meet medium-term targets, “even though it is difficult to predict the impact of the Ukraine conflict on the global economy”.

The Milan-based, Hong Kong-listed company said that it will propose a dividend of 7 cents per share, with a payout ratio of 61 per cent.

Sales last year jumped above pre-pandemic levels to 3.36 billion euros, the fashion house announced in January.

In November, the company announced a 4.5 billion euro medium-term revenue target and stated that it aimed for an operating profit of 20% of total sales in the medium run.

Operating profit was 14.5 per cent of total sales last year, up from 9.5 percent before the coronavirus epidemic in 2019.

When the coronavirus crisis struck, businesses throughout the world were forced to close storefronts, robbing them of tourist revenue. Prada, noted for its austere designs, was in the midst of a transition upmarket and online to restore sales.

However, the family-owned firm, like other luxury brands, has thrived in the wake of the epidemic, due to a desire among cooped-up consumers to indulge themselves with high-end goods.

(Adapted from Reuters.com)