Despite expecting a slight dip in organic sales in Q1, Ermenegildo Zegna Group remains optimistic about reaching its sales target of €2 billion in 2024. The group’s average annual sales are projected to grow by 10 per cent and adjusted EBIT by 20 per cent, showcasing its dedication to ongoing success and innovation.
Looking forward, the Zegna group has unveiled plans for a cutting-edge production center for luxury footwear and leather goods in Sala Baganza, Italy, slated to start operations in 2026. Spanning nearly 12,000 sq m and employing 300 individuals, this advanced facility will not only strengthen the group’s production capabilities but also serve as a research and development hub to enrich the its customisation offerings.
In 2023, the group achieved remarkable success across its various brands and segments. Following the announcement of sales rising by 27.6 per cent from previous year to €1.9 billion in January, the renowned Italian fashion conglomerate reported outstanding financial results. Its net profit more than doubled, soaring from €65.3 million in 2022 to €135.7 million in 2023, showcasing a notable margin expansion from 4.4 per cent to 7.1 per cent.
Listed on the New York Stock Exchange and known for its Zegna and Thom Browne brands, as well as its management of Tom Ford's pre-porter collections under license, the group witnessed a robust surge in adjusted operating profit (EBIT), which rose by 40 per cent to reach €220.2 million.
Within the Zegna segment, including the flagship brand and the conglomerate's textile activities, sales reached €1.32 billion, rising by 12.4 per cent increase, while the adjusted operating profit increased by 36.7 per cent to €193.5 million. This segment also saw a notable margin improvement to 14.6 per cent, attributed to strategic adjustments in distribution channels and a heightened focus on Zegna-branded products.
Moreover, the group's retail network, responsible for 85 per cent of total sales, experienced improved profitability, further contributing to the stellar results. Efforts to optimise Thom Browne's wholesale distribution also yielded positive outcomes, with sales rising by 14.9 per cent to €380.3 million in 2023and an impressive adjusted operating profit margin of 15.5 per cent.
The integration of Tom Ford Fashion, completed in April 2023, significantly expanded the group's luxury portfolio. Despite initial operational challenges resulting in an adjusted operating loss of €1.7 million, the segment, covering various fashion categories and managed directly by the group, recorded promising sales figures of €235.5 million within eight months.
