Italian fashion house Giorgio Armani Asia is the latest luxury retailer to cite greater China as the cause of a downturn in sales.
Burberry and Hugo Boss have also been hit by China’s economic slowdown, leading to Hugo Boss cutting its prices in Asia.
Armani says revenues grew 4.5 per cent last year, a 16 per cent drop from the year before. Revenues totalled €2.65 billion (US$ 2.95 billion). Prada had sales of €3.55 billion.
The Milan-based group, whose products include accessories, cosmetics and furniture, and the more affordable Armani Exchange range, says earnings before interest, tax, depreciation and amortisation edged up 1 per cent to €513 million last year, from €507 million in 2014.
Despite the slowdown, the firm says its cash reserves of €640 million allowed it to step up investments in its brands to “further strengthen its competitive market position”.
“These results are the outcome of an attentive diversification policy for the group’s lines, paired with the co-ordination of distribution channels and enhancement of the role that our trade partners play,” says president Giorgio Armani, who founded the company in 1975. The 81-year-old designer is still actively involved in the business.