Luxottica posts record net margin, confident of securing merger approval from China

The Italian eyewear company’s reported net income for the first half of 2018 reached euro 530 million (AU$835.6 m), a 9.8% increase compared to the same period last year at constant exchange rates.However, net sales dropped by 7.7% at current exchange rates, and only recorded a modest increase of 0.3% at constant exchange rates. This was primarily due to the wholesale division of the business, which recorded a 3.6% decrease in net sales at constant currency rates.{{quote-A:R-W:450-I:2-Q: Our e-commerce business is more and more important in our strategy. -WHO:Leonardo Del Vecchio, Luxottica}}In a company release announcing the figures, Luxottica’s founder and executive chairman Mr Leonardo Del Vecchio said he was very pleased with the results.“The growth in the markets where we completed the new commercial strategy, including North America and Asia, confirms the value and effectiveness of the initiatives undertaken. We look with confidence at Europe’s prospects, the region where we are reorganising our distribution strategy,” he said.“The group’s digital evolution is ongoing. Our e-commerce business is more and more important in our strategy and our communication is now focused on digital and social media.”The announcent also included an update on the progress of the merger with Essilor, which at the time of going to press was still waiting for approval from Chinese regulators. The company stated that the companies were finalising discussions with the country’s competition authorities and rained confident of obtaining approval in the near future.Meanwhile, Luxottica has also acquired sun lens maker Barberini for euro 140 million ($AU220 m) as part of its strategy to promote “made in Italy” quality eyewear.Barberini is a major manufacturer of optical glass lenses and according to Luxottica it generates annual net sales of approximately euro 85 million (AU$134.01 m). The company controls its entire manufacturing chain, from raw material to finished lenses, and owns industrial sites in Abruzzo (Italy), a plant in Germany for glass melting, and advanced technologies for the production of polarising films for sun lenses.The acquisition is subject to customary closing conditions and is expected to be finalised by the third quarter of 2018.