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Brunello Cucinelli — Earnings Release 2021
Mar 10, 2022
4176_10-k_2022-03-10_5565a882-4f0a-49d6-9d20-e455a6a9f7da.pdf
Earnings Release
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| Informazione Regolamentata n. 1264-4-2022 |
Data/Ora Ricezione 10 Marzo 2022 17:37:11 |
Euronext Milan | |
|---|---|---|---|
| Societa' | : | BRUNELLO CUCINELLI | |
| Identificativo Informazione Regolamentata |
: | 158297 | |
| Nome utilizzatore | : | BRUNECUCIN02 - De Angelis | |
| Tipologia | : | 1.1 | |
| Data/Ora Ricezione | : | 10 Marzo 2022 17:37:11 | |
| Data/Ora Inizio Diffusione presunta |
: | 10 Marzo 2022 17:37:12 | |
| Oggetto | : | Results | The Board of Directors approves FY 2021 |
| Testo del comunicato |
Vedi allegato.
Press Release
CASA DI MODA BRUNELLO CUCINELLI: the BoD has approved the 2021 consolidated financial statements and the 2021 draft financial statements
- Net revenues of €712.2 million, up +30.9% (+32.4% at constant exchange rates) compared to 2020, with an increase of +17.2% compared to 2019;
- EBITDA of €193.3 million (27.1% margin), compared to €89.5 million last year and €169.6 million in the previous year (27.9% margin);
- EBIT of €77.0 million (10.8% margin), compared to a loss of €14.8 million at 31 December 2020 and a profit of €83.4 million in 2019 (13.7% margin);
- Net income of €56.3 million, compared to a loss of €32.1 million at 31 December 2020 and a profit of €53.1 million in 2019.
- Significant investments in line with multi-year planning and in favour of the contemporary nature of our "Casa di Moda": €61.6 million invested in 2021, up from €51.6 million in 2020 and €52.6 million in 2019;
- Characteristic Financial Indebtedness1 of € 23.0, a marked improvement compared to €93.5 million in 2020 and €30.1 million at 31 December 2019;
- The Board of Directors will make a proposal to the Shareholders' Meeting - called for 27 April 2022 – for the distribution of a dividend of €0.42 per share;
- Approved the 2021 Consolidated Non-Financial Statement;
- Approved a Stock Grant Plan for the years 2022-2024.
Brunello Cucinelli, Executive Chairman and Creative Director of the Casa Moda, commented as follows:
"I have firm faith in the wisdom of men"
"At a dramatic time for humanity, in this winter of our struggles, a new era of responsibility is required of us, the search for a peace forged by great thoughts. I grew up in the land of Francis of Assisi, from whom I learnt the great value of dialogue as the noblest means of always achieving harmony among men".
"Great challenges demand the courage to walk together and to reaffirm that common sense of humanity that only words can guarantee, when they rest on the brotherhood and wisdom of the men who rule the world".
"The year 2021, which we called the year of rebalancing, ended with some splendid results both economically and in terms of image for our brand. Turnover grew by 30.9% and consequently net profit was equal to €56.3 million ".
"This year opens with a quarter that is now drawing to a close with some particularly interesting results, the order intake for men's and women's winter collections 2022 was really significant. All this prompts us to envisage yet another year of good, balanced growth, with an increase in turnover of around 12%".
"A growth that we hope will generate human prosperity for our people, for our mother earth and for the whole of Creation. May the heavens and the stars enlighten us at this time, when souls have lost their bearings, but are filled with great hope for the bright future that awaits us".
1 The figure for Characteristic Financial Indebtedness and Investments does not reflect the effects of the application of IFRS 16.
Solomeo, 10 March 2022 - The Board of Directors of Brunello Cucinelli S.p.A. - a Casa di Moda operating in the luxury goods sector and listed on the Italian Stock Exchange - today examined and approved the consolidated financial statements and the draft financial statements as at 31 December 2021.
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We report the 2021 results today with two frames of mind. The first is one of great sorrow at the international tensions, which we would never have imagined in contemporary times, and we hope from the bottom of our hearts that everything will go well in the times to come; the second is one of positivity for a Fashion House that is living perhaps the best moment in its history, and with humility, courage, creativity and confidence we imagine it will have great possibilities for the decades to come.
2021 - a year of rebalancing for us - has been a splendid year, in which we feel we have been able to achieve excellent results, hand in hand with the perception of a further strengthening of our brand, both in terms of style identity and positioning in absolute luxury, and in terms of reliability and equitable behaviour towards all our stakeholders, customers, suppliers and shareholders.
From an economic point of view, we are extremely satisfied with the sales achieved, which are even higher than our expectations, and with the margins, which are in line with the plan of rebalancing to pre-pandemic levels in 2022. From a balance sheet point of view, we also consider the quality of our inventory to be excellent and the Net Financial Debt to have improved significantly, even in the presence of major investments.
In terms of image, we believe it was a memorable year for the company. A year in which we received two major international acknowledgements, which honoured us from a human point of view, and which we undoubtedly believe contributed greatly to our achievements by bringing further attention to our brand:
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the first concerning style, with the awarding of the 'Designer of the Year' prize to Brunello Cucinelli by the prestigious British men's fashion magazine GQ, presented in London at the Tate Modern Gallery in early September;
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the second was the invitation and personal participation of Brunello Cucinelli as a speaker at the G20 in Rome on 31st October, with a testimony on Humanistic Capitalism and Human Sustainability.
October also saw the presentation of the major project of the "Universal Library of Solomeo", which adds to the thousand-year projects conceived by the Brunello and Federica Cucinelli Foundation for the Borgo di Solomeo and our territory.
We believe that the entrepreneurial and philosophical principles, the foundation of our idea of Humanistic Capitalism and Human Sustainability, have proved to be a solid and effective guide in this year of rebalancing, and perhaps we can say that today we represent in the world a good image of 'total' sustainability: environmental, economic, cultural and spiritual.
Our constant and profound focus on respect for human dignity, serenity in the workplace, human relations and the harmonious cycle of life and nature has proved to be a 'wealth' capable of showing the way to act with great dignity and unity in the choices we have faced.
In these two years, we have shared, as always, the company's strategies and choices, guaranteeing the employment and salary levels of all our employees, and we have chosen never to ask for discounts to avoid harming others. These decisions of principle have protected the integrity of the company and of the entire supply chain, helping us to fully recover the loss of 2020, so that we can resume our solid and serene path of beautiful, gentle and balanced growth.
Net Revenues are in line with the preliminary figures released on 10 January, and confirm all the dynamics already discussed in detail.
| FY 2021 | % | FY 2020 | % | YoY Change % |
FY 2019 | Var. % | |
|---|---|---|---|---|---|---|---|
| Eur '000 | Eur '000 | FY 2021/ | Eur '000 | FY 2021/ | |||
| FY 2020 | FY 2019 | ||||||
| Europe | 219,150 | 30.8% | 173,078 | 31.8% | +26.6% | 176,900 | +23.9% |
| Italy | 84,223 | 11.8% | 68,323 | 12.6% | +23.3% | 89,720 | -6.1% |
| Americas | 238,238 | 33.4% | 174,242 | 32.0% | +36.7% | 205,768 | +15.8% |
| Asia | 170,568 | 24.0% | 128,370 | 23.6% | +32.9% | 135,373 | +26.0% |
| Revenues | 712,179 | 100.0% | 544,013 | 100.0% | +30.9% | 607,761 | +17.2% |
| YoY Change at constant exchange rates | +32.4% | ||||||
| FY 2021 | % | FY 2020 | % | YoY Change % |
FY 2019 | Var. % | |
| Eur '000 | Eur '000 | FY 2021/ | Eur '000 | FY 2021/ | |||
| FY 2020 | FY 2019 | ||||||
| Retail | 419,817 | 58.9% | 268,773 | 49.4% | +56.2% | 339,435 | +23.7% |
| Wholesale | 292,362 | 41.1% | 275,240 | 50.6% | +6.2% | 268,326 | +9.0% |
| Revenues | 712,179 | 100.0% | 544,013 | 100.0% | +30.9% | 607,761 | +17.2% |
| Income Statement the main cost items to pre-pandemic levels. |
Analysis of the income statement shows an excellent sales performance and a gradual realignment of | ||||||
| than the speed of the growth of sales. | When comparing with 2019, which we consider to be the most significant benchmark, we have to take into account the development of the retail network, which will contribute significantly to the expected results for the coming years, but which in the short term has produced an increase in rent that is higher |
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| In relation to network development, there were 114 boutiques as at 31 December 2021, compared to 107 boutiques as at 31 December 2020, with 4 openings and 3 conversions of wholesale monobrand boutiques, including the important space in the Dubai Mall and the exclusive resort of Gstaad. |
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| bringing the total number of converted spaces to 13. | Prestigious boutique expansions were also carried out between 2020 and 2021, including those in London, Paris, Moscow, St Petersburg, Shanghai, Tokyo and New York; the number of directly managed hard shops within Department Stores rose to 43 in 2021, compared to 31 hard shops at 31 December 2020, with the increase mainly related to the conversion to direct management of 10 spaces within Nordstrom's Luxury Department Stores. These conversions from the wholesale channel to the retail channel are in addition to the 3 conversions of wholesale monobrand boutiques already mentioned, Analysing the details of the Income Statement, the First Margin does not show significant changes; |
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| the margin at 31 December 2021 is 67.3%, in line with 2020 margins of 67.9%. |
| FY 2021 | % | FY 2020 | % | YoY Change % |
FY 2019 | Var. % | |
|---|---|---|---|---|---|---|---|
| Eur '000 | Eur '000 | FY 2021/ | Eur '000 | FY 2021/ | |||
| FY 2020 | FY 2019 | ||||||
| Retail | 419,817 | 58.9% | 268,773 | 49.4% | +56.2% | 339,435 | +23.7% |
| Wholesale | 292,362 | 41.1% | 275,240 | 50.6% | +6.2% | 268,326 | +9.0% |
| Revenues | 712,179 | 100.0% | 544,013 | 100.0% | +30.9% | 607,761 | +17.2% |
Income Statement
In 2021, our Casa di Moda confirmed, as in 2020, its decision to maintain and guarantee the employment and salary levels of all its human resources, increasing their number in relation to the strategic choices adopted.
Personnel costs therefore grow progressively in the period 2019-2020-2021, following the expansion of our human resources structure to support new commercial initiatives, the expansion of the network, and the processes of consolidation of our activities.
In 2021, personnel costs amounted to €132.9 million (€119.6 million in 2020 and €112.2 million in 2019), with 2,160 FTE (full time equivalent) resources, compared to 2,045 FTE resources in 2020 and 1,890 resources in 2019. The incidence of personnel costs is 18.7% in 2021, compared to 18.5% in 2019.
Investments in communication, amounting to €36.1 million, increased compared to €32.1 million in 2020 and €35.5 million in 2019, with the incidence that remains above 5% (5.1% in 2021).
Investments are correlated with the important and strategic digital communication activities that were developed across all 12 months of 2021, and to the boutique events that were concentrated instead in the second half of the year (limited in the first half due to the effects of the pandemic).
The trend in rental costs follows the trend in openings, reaching €30.6 million (4.3% incidence) at 31 December 2021, compared with €17.9 million in 2020 and €21.8 million in 2019 (3.6% incidence).
Rental costs net of IFRS 16 effects amounted to €115.3 million (16.2% incidence), compared to €96.4 million last year and €85.6 million in 2019 (14.1% incidence); the progressive increase is mainly related to the development of the network, the benefit of which will also contribute to the results of the coming periods.
In 2021, Ebitda is therefore €193.3 million (27.1% margin), compared to €89.5 million last year and €169.6 million in 2019 (27.9% margin).
In 2021, Ebitda, net of IFRS 162 effects is € 110.0 million (15.4% margin). The value of Ebitda at 31 December 2021 also benefits from non-recurring revenues of € 5.2 million3 .
In 2020, EBITDA net of IFRS 16 effects and the extraordinary provision of €31.7 million for the "Brunello Cucinelli for Humanity" project amounted to €41.8 million, with a margin of 7.7%, while EBITDA net of IFRS 16 effects in 2019 amounted to €106.1 million, with a margin of 17.4%.
Depreciation and amortisation, excluding rights of usage4 , amounted to €40.6 million (5.7% incidence), compared to €34.8 million last year and €29.2 million in 2019 (4.8% incidence), in line with the progressive growth of capex.
Ebit at 31 December 2021 was € 77.0 million (margin of 10.8%), compared to the operating loss of € 14.8 million last year and the positive result of € 83.4 million (margin of 13.7%) in 2019.
The result of financial operations at 31 December 2021 was negative and equal to € 13.0 million, compared to € 19.0 million last year and € 14.2 million in 2019.
2 The accounting effects related to the application of IFRS 16 are equal to €84,690 thousand referring to the item "Rent payable" and equal to €1,392 thousand referring to the item "Other operating costs/(revenues)"; the EBITDA excluding IFRS 16 at 31 December 2021 is therefore equal to €110,013 thousand.
3 These items refer to non-recurring revenues (recorded in "Other operating expenses/(revenues)") related to tax credits for Research and Development activities for the years 2016, 2017 and 2018 for a total amount of €5,202 thousand.
4 Amortisation including amortisation of usage rights amounted to €116.3 million at 31/12/21, compared to €104.3 million at 31/12/2020 and €86.3 million at 31/12/2019.
The Net Profit was € 56.3 million at 31 December 2021, with a tax rate of 12.1%5 (excluding nonrecurring events, the normalised tax rate at 31 December 2021 was 28.5%); at 31 December 2020 the Net Profit result was a negative € 32.1 million, while 2019 reported a positive Net Profit of €53.16 million with a tax rate of 23.3%7 .
Balance Sheet
Net working capital, including "Other net assets/liabilities"8 is € 142.2 million as of 31 December 2021, compared to € 186.7 million last year and € 155.1 million as of 31 December 2019.
Trade net working capital amounted to €169.4 million as of 31 December 2021, with a 23.8% incidence on sales, compared to €195.8 million as of 31 December 2020, a value strongly impacted by the pandemic and with a 36.0% incidence.
The dynamics of the trade net working capital also show an improvement compared to 2019, whose value was €174.0 million with a 28.6% incidence.
Inventory amounted to € 199.3 million at 31 December 2021 (28.0% incidence), down from € 208.3 million at 31 December 2020 and € 204.9 million at 31 December 2019.
Inventory performance shows the complete recovery of sales and shipping activities, the overcoming of the phase related to the lockdown period of 2020, and a further optimisation thanks to the important sell-outs.
This is in the presence of significant business development, new commercial initiatives, and the expansion of the digital channel activity.
Trade receivables amounted to € 72.8 million at 31 December 2021, compared to € 78.9 million last year, despite the increase in turnover.
The reduction was driven by the return to ordinary terms in the payment terms of all wholesale customers, after some extensions that had been granted in 2020 following the outbreak of the pandemic, on the basis of a relationship of extreme mutual cooperation consolidated over time.
Trade payables amounted to € 102.7 million, compared to € 91.4 million at 31 December 2020. In 2021, the timing of payments to its suppliers, collaborators and consultants remained unchanged, and purchases of raw materials were more concentrated in the second half of the year, compared to what happened in 2020.
5 Please note that the tax rate for this year mainly benefits from two phenomena of a non-recurring nature: recognition of deferred tax assets, for a total amount of approximately Euro 8.8 million, calculated on the balance sheet balance of the inventory writedown provision for the "Brunello Cucinelli for Humanity" project; tax effect relating to tax credits for Research and Development activities recognised by the Parent Company referring to the 2016, 2017 and 2018 financial years mentioned above and the recognition of which, not being subject to taxation, produces a positive tax effect of Euro 1.5 million.
6 The Net Income at 31 December 2019 included the tax benefits of the "Patent Box", which ended on 31 December 2019, with a total value for 2019 of €5.7 million.
7 Excluding the tax benefit related to the Patent Box, the normalised tax rate at 31 December 2019 is 30.9%.
8 "Other net assets/liabilities" were negative for €27.3 million at 31 December 2021, compared to €9.1 million at 31 December 2020, with dynamics essentially related to the valuation of fair values on derivative instruments hedging foreign exchange risk.
In 2021, our investment plan was very important and amounted to €61.6 million, higher than both the €51.6 million invested in 2020 and the €52.6 million invested in 2019: we have always wanted to keep the image of our Casa di Moda modern and contemporary.
Commercial investments, amounting to €45.9 million, compared to €39.6 million in 2020, were mainly allocated to the expansion of prestigious boutiques, the renovation of our showrooms, and the increase in sales spaces, while also supporting the opening of new Casa Cucinelli spaces, the development of the wholesale channel and the growth of dedicated areas in Luxury Department Stores.
We have also dedicated a great deal of attention to all other investments, amounting to €15.7 million compared to €12.0 million in 2020; these include digital, technological and production/logistics investments, which have always accompanied the company's growth and development process.
Digital investments have supported the constant updating of the technological fundamentals and the user experience of the ecommerce site, enabling it to cope very effectively with the increase in digital channel flows over the last two years, particularly through mobile devices.
Our solid corporate structure supported the significant multi-year investment plan; the generation of cash and excellent results in the management of net working capital therefore enabled the strong and important improvement in the Characteristic Net Financial Debt9 of € 23,0 million as at 31 December 2021, compared to €93.5 million as at 31 December 2020 and €30.1 million as at 31 December 2019.
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9 Excludes financial payables for leases; therefore, the figure reported excludes the application of IFRS 16.
Business Outlook
The first part of 2022 shows very, very good results in both sales channels.
The retail channel is sustained by the very positive sell-outs of the Spring Summer 2022 men's and women's collections, with customer appreciation confirming the very positive feedback gathered during the presentation of the collections.
The order collection for the men's and women's Autumn Winter 2022 collections has ended with important results.
In the wholesale channel, we are favourably impressed by the enthusiasm with which our multi-brand partners have evaluated the creativity expressed in the collections. At the same time, they have rewarded the reliability and planning of our company in their budget allocation choices, and we think they have made a strong selection in terms of brand strategy.
Clearly, the large order book for the Autumn Winter 2022 collections, and the wonderful feedback from customers and the international press, suggest that the direct boutiques will also have winter merchandise that is judged to be beautiful.
These elements reinforce the feeling that our brand is living a very positive moment, supported by the freshness of the product and the authority of the sustainability proposal in its environmental, economic, cultural and moral declination.
Major investments in 2021 have enabled us to enrich our network, and to make our company more modern, more effective, faster and even more respectful of all resources.
We expect to continue in this vein in the years to come, willingly accepting every innovation that research makes available to us, with the ultimate aim of constantly elevating the image of our brand and our Fashion House in every implementation.
The excellent sales figures for these first few weeks of 2022, the significant quality of orders already in the pipeline for the second half of the year and the perceived attractiveness of our brand allow us to predict a very important year for our industry.
We therefore envisage in 202210 a growth of around +12%, the rebalancing of margins to our prepandemic normal levels, and an improvement in Net Financial Debt, confirming significant investments, in line with the multi-year planning as was the case in 2021.
With equal confidence we expect balanced growth in 2023 of around +10%.
The wonderful 2021 that we have concluded, the concreteness of our expectations for 2022 and 2023, and the path of healthy growth and sustainability that we expect in the coming years, allow us not only to look with great confidence at the goal of doubling turnover, which we had initially planned for the 2019-2028 ten-year plan, but also allow us to imagine that we can achieve it as early as 2026.
Conscious of our idea of Humanistic Capitalism and Human Sustainability, we will always try to keep our commitment to Living in Harmony with Creation, trying to make the environmental dimension coexist with the economic, moral and cultural one.
This is why, in line with our philosophy and our approach to doing business, we will continue to seek a balance between profit and giving, respecting the moral and economic dignity of the human being, be it our human resources, our artisan craft workshops, our suppliers of raw materials, a collaborator of our fashion house, or the end customer.
10 Our expectations take due account of the current situation in Russia. The potential effects on our sales are limited as our business in the region is mainly local and wholesale in nature. Deliveries of the Spring Summer 2022 collections have already been completed. Orders for the Fall Winter 2022 collections have already been fully collected and the first shipments are expected to start in June.
The Board of Directors will propose at the next Shareholders' Meeting, which will be held in a single call on 27 April 2022, to approve the distribution of a dividend, relating to the 2021 financial year, equal to €0.42 per share (gross of any amounts to be withheld by law).
The dividend will be paid on 25 May 2022, with the share going ex-dividend on 23 May 2022 (detachment of coupon no. 8). The record date will be 24 May 2022.
Report on Corporate Governance and Ownership Structure and Report on Remuneration Policy and Compensation Paid
The Company's Board of Directors approved the Report on Corporate Governance and Ownership Structure for the year 2021 and the Report on Remuneration Policy and Compensation Paid pursuant to Article 123-ter of Legislative Decree no. 58/1998.
In particular, the Board of Directors resolved, after receiving the favourable opinion of the Remuneration and Appointments Committee, to submit for examination and approval of the Shareholders' Meeting called, in a single call, for 27 April 2022, a new remuneration policy applicable to the financial years 2022, 2023 and 2024, which shall replace, with reference to the financial year 2022, the previous policy approved by the Shareholders' Meeting resolution of 21 May 2020.
Compensation plan based on financial instruments ("2022-2024 Stock Grant Plan") and plan for the purchase and disposal of treasury shares
The Company's Board of Directors, having received a favourable opinion from the Remuneration and Appointments Committee, approved a compensation plan based on financial instruments, the 2022- 2024 Stock Grant Plan, pursuant to article 114 bis of Legislative Decree 58/1998 (TUF), which will be submitted for examination and approval by the Shareholders, convened, in a single call, at the Shareholders' Meeting on 27 April 2022.
The 2022-2024 Stock Grant Plan is based on the free assignment of Brunello Cucinelli S.p.A.'s ordinary shares to the Managing Directors of the Company as well as to additional beneficiaries to be identified by the Board of Directors from among the managers of the Brunello Cucinelli Group who hold strategically important positions or who are in any case able to make a significant contribution to commercial development and, in general, to the pursuit of the Group's strategic objectives.
The objective of the 2022-2024 Stock Grant Plan is to involve and incentivize its beneficiaries in the achievement of the Brunello Cucinelli Group's strategic objectives. The Plan is also aimed at fostering the loyalty of beneficiaries, providing an incentive for them to remain within the Brunello Cucinelli Group, and at aligning their interests with those of the Company and the shareholders over the period of the Plan, acknowledging their contribution to increasing the value of the Company. The Plan is an instrument for supplementing the fixed component of the beneficiaries' remuneration package with a variable component.
The Plan has a three-year duration and subordinates the assignment of the shares to the achievement by the beneficiaries of specific performance targets, determined by the Board of Directors and in any case connected with the creation of sustainable value for the shareholders and all the stakeholders, in line with the prospects and the strategic development plans of the Company and the Group.
For a detailed description of the resolution proposal for the adoption of the 2022-2024 Stock Grant Plan, of the beneficiaries and of the terms and conditions of the Plan, reference should be made to the information document prepared by the Board of Directors, which will be published pursuant to Article 84-bis of the Issuers' Regulations and Annex 3A to the Issuers' Regulations and made available to the public at the registered office and on the website www.investor.brunellocucinelli.com, in the "Corporate
Governance" section, as well as in the other ways provided for by law and by the regulations in force, for the entire duration of the Plan.
In order to implement the 2022-2024 Stock Grant Plan, the Board of Directors resolved to submit a request for authorization to the Ordinary Shareholders' Meeting of the Company to purchase and dispose of Brunello Cucinelli ordinary shares (buy back plan), in one or more tranches, in compliance with the procedures prescribed by the from time to time applicable EU and national laws and regulations.
The proposal provides for the authorisation to purchase, in one or more tranches, a maximum of 275,000 Brunello Cucinelli ordinary shares. The proposal also envisages that the authorisation to make the purchases will be granted for the period of 18 months starting from the date of approval by the Shareholders' Meeting of the request for authorisation to purchase and dispose of treasury shares (without prejudice, in any case, to the maximum duration limit established by law), while the authorisation to dispose of the treasury shares purchased will be granted without time limits. Purchases will be made at a price not higher than the highest price between the price of the last independent transaction and the price of the highest current independent purchase offer on the trading venue where the purchase is made, it being understood that the price cannot be lower in the minimum and higher in the maximum of 10% of the reference price that Brunello Cucinelli shares have recorded in the session on the day prior to each individual transaction; in any event, subject to compliance with the from time to time applicable regulations (and in particular of the Delegated Regulation EU no. 1052/2016) and of the admitted market practices (where applicable).
As of the date of approval of the 2022-2024 Stock Grant Plan, the Company does not hold any of its own shares and none of the companies it controls hold Brunello Cucinelli shares.
2021 Consolidated Non-Financial Statement
The Board of Directors also examined and approved the 2021 Consolidated Non-Financial Statement, prepared as a report separate from the Financial Statements in accordance with the requirements of Legislative Decree No. 254/2016 on the communication of non-financial information.
This statement contains information relating to the company's activity, its performance, its results and the effect produced by such, in connection with environmental matters, social matters, employee-related matters, respect for human rights and combatting corruption. The 2021 Consolidated Non-Financial Statement will be published within the time limits laid down by law.
Updating of the organisation and control model pursuant to Legislative Decree 231/2001
The Board of Directors, in the light of the progressive increase in the number of predicate offences and the development of case law on the subject, has approved the new organisational model of management and control, both in relation to the General Section and the Special Section.
Convening the General Meeting
The Board of Directors resolved to call the Shareholders' Meeting for 27 April 2022 in a single call to approve the financial statements as at 31 December 2021, to allocate the profit for the year and to resolve on the Report on remuneration policy and compensation paid, to approve the "2022-2024 Stock Grant Plan" and to authorise the purchase and disposal of its own shares to service the Stock Grant Plan.
The notice of the Shareholders' Meeting will be published within the terms of the law on the Company's website (http://investor.brunellocucinelli.com) and, in extracts, in the daily newspapers Il Sole 24 Ore and MF-Milano Finanza.
Documentation
The 2021 Annual Financial Report (together with the Report of the Board of Statutory Auditors and the Report of the External Auditors), the 2021 Report on Corporate Governance and Ownership Structure, the Report on the policy regarding remuneration and compensation paid, the 2021 Consolidated Non-Financial Statement, the illustrative information document of the 2022-2024 Stock Grant Plan and the illustrative reports prepared by the directors on the matters on the agenda (also approved at today's meeting of the Board of Directors) will be made available to the public within the time limits and by the means laid down by current law at the Company's registered office in Corciano, Solomeo (PG), Italy, on the "eMarket Storage" system () and in the specific sections of the Company's website (http://investor.brunellocucinelli.com).
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Pursuant to and in accordance with article 154-bis, paragraph 2 of Italian Legislative Decree no. 58 of 1998, the financial reporting officer, Moreno Ciarapica, declares that the disclosures included in this press release correspond to the documented results and the accounting records and entries. The PDF of the Analyst Presentation of the results as at 31 December 2021 can be consulted on the website at http://investor.brunellocucinelli.com/ita/presentazioni/. The figures in this press release refer to the 2021 consolidated financial statements.
This document (and in particular the section "Business Outlook") contains forward-looking statements on future events regarding the Brunello Cucinelli Group and its operating, economic and financial results. By their very nature, these forecasts contain an element of risk and uncertainty as they depend on the occurrence of future events and developments.
The 2021 consolidated financial statements and draft statutory financial statements are currently subject to auditing that has not yet been completed at today's date. The 2021 Consolidated Non-financial Statement is in turn subject to an audit by the auditors in accordance with article 3, paragraph 10 of Italian Legislative Decree no. 254/2016.
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Brunello Cucinelli S.p.A. is an Italian Casa di Moda that produces luxury goods. It was founded in 1978 by the fashion designer and entrepreneur of the same name and is listed on the Italian Electronic Stock Exchange. The Company has always been rooted in the medieval hamlet of Solomeo and it is considered an authentic expression of the concept of "Humanistic Capitalism" since it can match constant, sound growth with an entrepreneurial philosophy addressing the major issues of Harmony with Creation and Human Sustainability.
Specialised in cashmere, the brand is currently believed to be one of the most exclusive brands in the chic prêt-à-porter sector, an expression of everyday lifestyle worldwide. The combination of modernity and craftsmanship, elegance and creativity, and passion and human values make Brunello Cucinelli one of the world's most exclusive and admired ambassadors of Italian style. In fact, the brand authentically expresses the values of tailoring and craftsmanship typical of products Made in Italy and the territory of the Umbria region in particular, combined with a focus on innovation and contemporary style.
Through healthy, balanced and sustainable growth, the company's main goal is to earn profits with ethics, morality and dignity, respecting the moral and economic dignity of the over 2,100 directly employed Human Resources and all those who work with them.
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Contact details: Investor Relations & Corporate Planning
Pietro Arnaboldi Brunello Cucinelli S.p.A. Tel. 075/69.70.079
Media
Vittoria Mezzanotte Brunello Cucinelli S.p.A. Tel. 02/34.93.34.78
Corporate website: www.brunellocucinelli.com
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 31 DECEMBER 2021
| (Euro/000) | December 31, 2021 | related parties |
December 31, 2020 | related parties |
|---|---|---|---|---|
| Non-current assets | ||||
| Goodwill | 7,045 | 7,045 | ||
| Right of use | 504,968 | 4,677 | 470,197 | 5,193 |
| Intangible assets | 13,070 | 12,136 | ||
| Property, plant and equipment | 166,033 | 12,517 | 150,254 | 17,487 |
| Investment property | 6,593 | 4,179 | ||
| Non-current financial assets for leases | 3,886 | 402 | ||
| Other non-current financial assets | 13,538 | 32 | 11,039 | 32 |
| Deferred tax asset | 49,546 | 35,368 | ||
| Non-current derivative financial assets | 125 | - | ||
| Total non-current assets | 764,804 | 690,620 | ||
| Current assets | ||||
| Inventories | 199,266 | 208,347 | ||
| Trade receivables | 72,809 | 52 | 78,871 | 51 |
| Tax receivables | 1,735 | 3,871 | ||
| Other receivables and other current assets | 29,010 | 20,068 | ||
| Current financial assets for leases | 2,633 | 173 | ||
| Other current financial assets | 80 | 11 | ||
| Cash and cash equivalents | 98,003 | 72,834 | ||
| Current derivative financial instruments | 161 | 4,935 | ||
| Total current assets | 403,697 | 389,110 | ||
| Total assets | 1,168,501 | 1,079,730 |
| (Euro/000) | December 31, 2021 | related parties |
December 31, 2020 | related parties |
|---|---|---|---|---|
| Shareholders' equity | ||||
| Shareholders' equity attributable to parent company shareholders | ||||
| Share capital | 13,600 | 13,600 | ||
| Share-premium Reserve | 57,915 | 57,915 | ||
| Reserves | 191,304 | 220,670 | ||
| Net income for the period | 53,322 | (33,216) | ||
| Total shareholders' equity attributable to owners of the parent | 316,141 | 258,969 | ||
| Shareholders' equity attributable to non-controlling interests | ||||
| Capital and reserves attributable to non-controlling interests | 3,286 | 988 | ||
| Net income for the period attributable to non-controlling interests | 2,973 | 1,147 | ||
| Total shareholders' equity attributable to non-controlling interests | 6,259 | 2,135 | ||
| Total shareholders' equity | 322,400 | 261,104 | ||
| Non-current liabilities | ||||
| Employees termination indemnities | 3,044 | 3,108 | ||
| Provisions for risks and charges | 2,400 | 937 | ||
| Non-current payables towards banks | 73,676 | 60,133 | ||
| Financial liabilities for non-current leases | 469,753 | 4,595 | 436,956 | 5,115 |
| Other Financial liabilities | 1,178 | - | ||
| Other non-current liabilities | 788 | 60 | ||
| Deferred Tax liabilities | 8,575 | 6,402 | ||
| Non-current derivative financial instruments liabilities | - | 217 | ||
| Total non-current liabilities | 559,414 | 507,813 | ||
| Current liabilities | ||||
| Trade payables | 102,654 | 621 | 91,412 | 550 |
| Current payables towards banks | 43,375 | 105,007 | ||
| Financial liabilities for current leases | 79,610 | 541 | 75,412 | 516 |
| Current financial liabilities | 2,649 | 799 | ||
| Income tax payables | 12,242 | 2,621 | ||
| Other current liabilities | 39,203 | 717 | 35,071 | 2,552 |
| Current derivative financial instruments | 6,954 | 491 | ||
| Total current liabilities | 286,687 | 310,813 | ||
| Total liabilities | 846,101 | 818,626 | ||
| Total equity and liabilities | 1,168,501 | 1,079,730 |
CONSOLIDATED INCOME STATEMENT AT 31 DECEMBER 2021
| (Euro/000) | December 31, 2021 | related parties |
December 31, 2020 | related parties |
|---|---|---|---|---|
| Revenues | 712,179 | 5 | 544,013 | 7 |
| Costs of raw materials and consumables | (113,610) | (116) | (53,725) | (56) |
| Costs for services | (271,084) | (3,929) | (243,296) | (2,202) |
| Payroll costs | (132,948) | (2,119) | (119,569) | (1,390) |
| Other operating expenses | (9,813) | (8,902) | ||
| Other operating income | 10,054 | 43 | 2,772 | 40 |
| Costs capitalized | 3,445 | 3,258 | ||
| Depreciation and amortization | (116,275) | (104,284) | ||
| Impairment of assets and other accruals | (4,912) | (35,085) | ||
| Total operating costs | (635,143) | (558,831) | ||
| Operating Income | 77,036 | (14,818) | ||
| Financial expenses | (34,908) | (46,956) | ||
| Financial income | 21,898 | 27,992 | ||
| Income before taxation | 64,026 | (33,782) | ||
| Income taxes | (7,731) | 1,713 | ||
| Net income for the period | 56,295 | (32,069) | ||
| Net income for the period attributable to owners of the parent | 53,322 | (33,216) | ||
| Net income for the period attributable to non-controlling interests | 2,973 | 1,147 | ||
| Base earnings per share | 0.78415 | (0,48847) | ||
| Diluted earnings per share | 0.78415 | (0,48847) |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
| (Euro/000) | |||
|---|---|---|---|
| December 31, 2021 | December 31, 2020 | ||
| Net income for the period (A) | 56,295 | (32,069) | |
| Other items of comprehensive income: | |||
| Other items of comprehensive income that will later be reclassified on the income statement: |
4,986 | (5,127) | |
| Cash flow hedge | (6,719) | 3,626 | |
| Tax effect | 1,612 | (870) | |
| Effect of changes in cash flow hedge reserve | (5,107) | 2,756 | |
| Translation differences on foreign financial statements | 7,026 | (5,879) | |
| Profit / (Losses) on net investment in a foreign operation | 4,035 | (2,637) | |
| Tax effect | (968) | 633 | |
| Other items of comprehensive income that will not later be reclassified on the income statement: |
(48) | 15 | |
| Remeasurement of defined benefit plans (IAS 19) | (63) | 20 | |
| Tax effect | 15 | (5) | |
| Total other comprehensive income, net of tax (B) | 4,938 | (5,112) | |
| Total comprehensive income net of tax (A) + (B) | 61,233 | (37,181) | |
| Attributable to: | |||
| Shareholders of parent company | 58,118 | (38,311) | |
| Non-controlling interests | 3,115 | 1,130 |
CONSOLIDATED STATEMENT OF CASH FLOWS AT 31 DECEMBER 2021
| (Euro/000) | December 31, 2021 | December 31, 2020 |
|---|---|---|
| CASH FLOW FROM OPERATING ACTIVITIES | ||
| Net income for the period | 56,295 | (32,069) |
| Adjustments to reconcile net income for the period to the cash flows generated by (used in) operating activities: |
||
| Income tax | 7,731 | (1,713) |
| Depreciation and amortization | 116,275 | 104,284 |
| Provisions for employees termination indemnities | 79 | 82 |
| Provisions for risks and charges / inventory obsolescence / doubtful accounts | 4,928 | 35,033 |
| Change in other non-current liabilities | 728 | (183) |
| (Gain)/Loss on disposal of Fixed assets | (79) | 41 |
| Write-down of equity investments | - | 583 |
| Other non-monetary items IFRS 16 | (568) | 227 |
| Interest expense | 1,452 | 2,215 |
| Interest on lease liabilities | 10,578 | 10,705 |
| Interest income | (18) | (28) |
| Interest on lease activities | (18) | (17) |
| Termination indemnities payments | (204) | (133) |
| Payments of Provisions for risks and charges | (681) | (927) |
| Net change in deferred tax assets and liabilities | (10,716) | (6,897) |
| Change in fair value of financial instruments | 4,175 | (4,070) |
| Changes in operating assets and liabilities: | ||
| Change in trade receivables | 6,603 | (22,916) |
| Change in inventories | 18,234 | (44,477) |
| Change in trade payables | 5,522 | 9,392 |
| Interest expense paid | (1,518) | (2,118) |
| Interest on the lease liabilities paid | (10,578) | (10,705) |
| Interest income cashed | 18 | 28 |
| Interest on lease activities cashed | 18 | 17 |
| Income tax paid | (7,781) | (9,107) |
| Change in other current assets and liabilities | 7,701 | 9,215 |
| Net cash provided by/(used in) operating activities (A) | 208,176 | 36,462 |
| CASH FLOW FROM INVESTING ACTIVITIES | ||
| Additions to property, plant and equipment | (42,786) | (39,754) |
| Additions to intangible assets | (10,705) | (7,434) |
| Additions/(disposals) of financial assets | (1,817) | (2,814) |
| Additions to investment property | (2,472) | (1,432) |
| Investement/Disinvestments in financial assets held for trading | - | 9,120 |
| Acquisition of Brunello Cucinelli Midlle East, net of cash acquired | (1,669) | - |
| Proceeds from disposal of property, plant and equipment | 1,096 | 1,254 |
| Net cash provided by/(used in) investing activities (B) | (58,353) | (41,060) |
| CASH FLOW FROM FINANCING ACTIVITIES | ||
| Medium/Long-term loans received | 62,000 | 151,729 |
| Repayment of medium/long-term loans | (116,784) | (36,456) |
| Net change in short-term financial debt | 8,340 | (52,576) |
| Net change in long-term financial debt | 1,133 | - |
| Repayment of lease liabilities | (83,989) | (50,630) |
| Receipts of financial assets for leasing | 1,918 | 255 |
| Dividends paid | - | (1,076) |
| Share capital and reserves increase | - | 22 |
| Net cash provided by/(used in) financing activities (C) | (127,382) | 11,268 |
| TOTAL CASH FLOW FOR THE PERIOD (D=A+B+C) | 22,441 | 6,670 |
| Effect of exchange rate changes on cash and cash equivalents (E) | 2,728 | (2,768) |
| CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD (F) | 72,834 | 68,932 |
| CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD (G=D+E+F) | 98,003 | 72,834 |
| (Euro/000) | December 31, 2021 | related parties |
December 31, 2020 | related parties |
|---|---|---|---|---|
| Non-current assets | ||||
| Right of use | 57,847 | 4,677 | 54,433 | 5,193 |
| Intangible assets | 12,298 | 11,273 | ||
| Property, plant and equipment | 71,279 | 6,960 | 72,460 | 12,526 |
| Investment property | 9,268 | 7,903 | ||
| Non-current financial assets for leases | 402 | 402 | ||
| Other non-current financial assets | 241,670 | 126,564 | 225,666 | 113,435 |
| Deferred tax asset | 10,047 | 2,882 | ||
| Non-current derivative financial assets | 125 | - | ||
| Total non-current assets | 402,936 | 375,019 | ||
| Current assets | ||||
| Inventories | 111,152 | 116,291 | ||
| Trade receivables | 108,206 | 63,332 | 148,589 | 95,743 |
| Tax receivables | - | 1,373 | ||
| Other receivables and other current assets | 22,848 | 6,150 | 13,557 | 297 |
| Current financial assets for leases | 199 | 173 | ||
| Other current financial assets | 2,322 | 2,242 | 1,237 | 1,226 |
| Cash and cash equivalents | 47,381 | 30,025 | ||
| Current derivative financial instruments | 161 | 4,935 | ||
| Total current assets | 292,269 | 316,180 | ||
| Total assets | 695,205 | 691,199 |
| (Euro/000) | December 31, 2021 | related parties |
December 31, 2020 | related parties |
|---|---|---|---|---|
| Shareholders' equity | ||||
| Shareholders' equity attributable to parent company shareholders | ||||
| Share capital | 13,600 | 13,600 | ||
| Share-premium Reserve | 57,915 | 57,915 | ||
| Reserves | 235,809 | 266,814 | ||
| Net income for the period | 60,980 | (25,868) | ||
| Total shareholders' equity | 368,304 | 312,461 | ||
| Non-current liabilities | ||||
| Employees termination indemnities | 1,878 | 1,992 | ||
| Provisions for risks and charges | 1,808 | 445 | ||
| Non-current payables towards banks | 73,676 | 60,133 | ||
| Financial liabilities for non-current leases | 51,790 | 4,595 | 51,167 | 5,115 |
| Other Financial liabilities | - | - | ||
| Other non-current liabilities | 121 | 60 | ||
| Deferred Tax liabilities | 448 | 1,074 | ||
| Non-current derivative financial instruments liabilities | - | 217 | ||
| Total non-current liabilities | 129,721 | 115,088 | ||
| Current liabilities | ||||
| Trade payables | 95,925 | 6,128 | 87,516 | 10,499 |
| Current payables towards banks | 43,375 | 105,006 | ||
| Financial liabilities for current leases | 8,275 | 541 | 8,193 | 516 |
| Current financial liabilities | - | 799 | ||
| Income tax payables | 10,111 | 375 | ||
| Other current liabilities | 32,540 | 14,427 | 61,270 | 43,109 |
| Current derivative financial instruments | 6,954 | 491 | ||
| Total current liabilities | 197,180 | 263,650 | ||
| Total liabilities | 326,901 | 378,738 | ||
| Total equity and liabilities | 695,205 | 691,199 |
INCOME STATEMENT AT 31 DECEMBER 2021
| (Euro/000) | December 31, 2021 | related parties |
December 31, 2020 | related parties |
|---|---|---|---|---|
| Revenues | 468,851 | 236,920 | 420,662 | 215,853 |
| Costs of raw materials and consumables | (108,022) | (9,772) | (79,382) | (10,630) |
| Costs for services | (197,080) | (10,255) | (190,522) | (10,189) |
| Payroll costs | (66,852) | (2,119) | (64,766) | (1,390) |
| Other operating expenses | (17,575) | (13,710) | (44,062) | |
| Other operating income | 13,115 | 6,594 | 1,711 | 513 |
| Costs capitalized | 910 | 1,055 | ||
| Depreciation and amortization | (21,663) | (20,638) | ||
| Impairment of assets and other accruals | (3,950) | (35,278) | ||
| Total operating costs | (401,117) | (431,882) | ||
| Operating Income | 67,734 | (11,220) | ||
| Financial expenses | (26,631) | (151) | (40,330) | (165) |
| Financial income | 28,643 | 2,295 | 28,702 | 1,827 |
| Income before taxation | 69,746 | (22,848) | ||
| Income taxes | (8,766) | (3,020) | ||
| Net income for the period | 60,980 | (25,868) |
STATEMENTS OF COMPREHENSIVE INCOME
| (Euro/000) | |||
|---|---|---|---|
| December 31, 2021 | December 31, 2020 | ||
| Net income for the period (A) | 60,980 | (25,868) | |
| Other items of comprehensive income: | |||
| Other items of comprehensive income that will later be reclassified on the income statement: |
(5,107) | 2,756 | |
| Cash flow hedge | (6,719) | 3,626 | |
| Tax effect | 1,612 | (870) | |
| Effect of changes in cash flow hedge reserve | (5,107) | 2,756 | |
| Translation differences on foreign financial statements | - | - | |
| Profit / (Losses) on net investment in a foreign operation | - | - | |
| Tax effect | - | - | |
| Other items of comprehensive income that will not later be reclassified on the income statement: |
(31) | 13 | |
| Remeasurement of defined benefit plans (IAS 19) | (41) | 17 | |
| Tax effect | 10 | (4) | |
| Total other comprehensive income, net of tax (B) | (5,138) | 2,769 | |
| Total comprehensive income net of tax (A) + (B) | 55,842 | (23,099) |
| (Euro/000) | December 31, 2021 December 31, 2020 | |
|---|---|---|
| CASH FLOW FROM OPERATING ACTIVITIES | ||
| Net income for the period | 60,980 | (25,868) |
| Adjustments to reconcile net income for the period to the cash flows generated by (used in) operating activities: |
||
| Income tax | 8,766 | 3,020 |
| Depreciation and amortization | 21,663 | 20,638 |
| Provisions for employees termination indemnities | - | - |
| Provisions for risks and charges / inventory obsolescence / doubtful accounts | 3,966 | 35,226 |
| Change in other non-current liabilities | 61 | 60 |
| (Gain)/Loss on disposal of Fixed assets | 33 | 41 |
| Write-down of equity investments | (157) | 1,759 |
| Writedown of financial receivables Group companies | - | 1,211 |
| (Profit) / Loss on exchange rates on transactions for the conversion of financial receivables to shareholders' equity of Group companies |
- | 831 |
| Other non-monetary items IFRS 16 | 400 | (338) |
| Interest expense | 1,396 | 2,183 |
| Interest on lease liabilities | 1,345 | 1,470 |
| Interest income | (2) | (9) |
| Interest on lease activities | (12) | (17) |
| Interest income on financial receivables from Group companies | (2,295) | (1,825) |
| Termination indemnities payments | (155) | (59) |
| Payments of Provisions for risks and charges | (664) | (825) |
| Net change in deferred tax assets and liabilities | (6,169) | (1,452) |
| Change in fair value of financial instruments | 4,176 | (4,070) |
| Changes in operating assets and liabilities: | ||
| Change in trade receivables | 40,574 | 8,679 |
| Change in inventories | 5,139 | (21,103) |
| Change in trade payables | 8,102 | 4,283 |
| Interest expense paid | (1,501) | (2,088) |
| Interest on the lease liabilities paid | (1,345) | (1,470) |
| Interest income cashed | 2 | 9 |
| Interest on lease activities cashed | 12 | 17 |
| Income tax paid | (3,568) | (6,807) |
| Change in other current assets and liabilities | (31,904) | 38,524 |
| Net cash provided by/(used in) operating activities (A) | 108,843 | 52,020 |
| CASH FLOW FROM INVESTING ACTIVITIES | ||
| Additions to property, plant and equipment | (7,385) | (8,074) |
| Additions to intangible assets | (7,448) | (4,633) |
| Additions/(disposals) of financial assets | (13,449) | (106,915) |
| Additions to investment property | (2,472) | (1,443) |
| Investement/Disinvestments in financial assets held for trading | 9,120 | |
| Repayment of medium / long-term loans from Group companies | - 3,556 |
2,449 |
| Proceeds from disposal of property, plant and equipment | 54 | 588 |
| Net cash provided by/(used in) investing activities (B) | (27,144) | (108,908) |
| CASH FLOW FROM FINANCING ACTIVITIES | ||
| 62,000 | 151,729 | |
| Medium/Long-term loans received | ||
| Repayment of medium/long-term loans | (116,784) | (36,456) |
| Net change in short-term financial debt | 5,721 | (52,577) |
| Net change in long-term financial debt | - | - |
| Repayment of lease liabilities | (9,969) | (6,513) |
| Receipts of financial assets for leasing | 227 | 235 |
| Dividends paid | - | |
| Share capital and reserves increase | - | |
| Net cash provided by/(used in) financing activities (C) | (58,805) | 56,418 |
| TOTAL CASH FLOW FOR THE PERIOD (D=A+B+C) | 22,894 | (470) |
| Effect of exchange rate changes on cash and cash equivalents (E) | (5,538) | 2,433 |
| CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD (F) | 30,025 | 28,062 |
| CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD (G=D+E+F) | 47,381 | 30,025 |