Ermenegildo Zegna ́s FY14 net profit takes a 28 percent dip

Italian luxury wear brand Ermenegildo Zegna saw a slowdown in growth over 2014 as its net profit for the last year fell to 71 million euros, suffering a 28.1 percent dip on a year-on-year basis.

According to the company, many were the reasons behind this setback ranging from an impact of taxation and exceptional costs associated to the re-launch of its Agnona project, to the slowdown in China, the recession in Russia or adverse currency fluctuations.

The EBITDA came in at 185 million euros (15.3 percent of sales). The group led by Gildo Zegna unveiled that "significant investments in Italy amounted to 20 million euro" and were aimed at strengthening the control of the supply chain.

Likewise, the group closed 2014 with a decline in sales of 4.7 percent to 1,210 million euros, reflecting some struggles in foreign markets – it´s noteworthy that 90 percent of the company’s revenue comes from abroad.

As the company explained in a note Monday, it was hit by the slower consumption in China and Russia, as well as by parity between the dollar, the yuan and yen.

China, albeit under braking, continues to be the largest market, followed by the US.