- CEO Marchetti sees ``much more consolidation'' in the industry
- Retailer not seeing any slowdown in China, Marchetti says
Yoox Net-a-Porter SpA Chief Executive Officer Federico Marchetti said the Web fashion retailer will probably generate annual cost savings in excess of the 60 million euros ($68 million) he estimated when the companies announced their merger in March.
“We like to deliver,” Marchetti said, adding he began to think about the merger six years ago.
The shares, which made their debut in Milan on Monday, rose as much as 6 percent and were up 5.2 percent at 29.53 euros as of 12:09 p.m. in the northern Italian city, giving the company a market value of about 3.8 billion euros.
Yoox agreed in March to merge with Cie. Financiere Richemont SA’s Net-a-Porter to create the world’s largest online luxury retailer. The company, which has annual revenue of more than 1.3 billion euros, said at the time it expected to deliver 60 million euros of synergies by the third year.
Speaking in a Bloomberg TV interview on Monday, Marchetti said he anticipated “much more consolidation” in the industry as competition intensifies in Web retailing of luxury goods but that he’s focused on integrating the two companies over the next couple of years.
Brands are joining department stores and publishers in offering designer clothing, handbags and accessories online, seeking to capture sales which brokerage Sanford C. Bernstein predicts will grow at more than twice the pace of the overall luxury market through 2019.
Marchetti also said Web sales of luxury goods in China weren’t being hurt by a slowing economy and a government clampdown on extravagance.
“We haven’t seen any slowdown” in China, Marchetti said, citing triple-digit percentage revenue growth there. “The Internet is completely different story to physical stores.”
Richemont, which owns about 50 percent of Yoox Net-a-Porter stock, gained as much as 4.9 percent. The maker of Cartier watches said earlier full-year profit will be boosted by an accounting gain of 610 million euros to 670 million euros from the transaction, based on Friday’s closing share price.
Richemont has agreed not to sell a 25 percent stake in the new company during three years.