Business

Jimmy Choo revenues boosted by menswear range

Male model wearing Jimmy Choo Image copyright Jimmy Choo

Jimmy Choo, the British luxury brand regularly seen on the red carpet, has reported strong revenue growth boosted by China, the weak pound and its menswear lines.

Revenue was up 14.5% to £364m, while operating profits rose 43% to £42.5m.

Shoes account for the majority of its sales, with men's remaining its "fastest growing category" accounting for 9% of revenue.

New stores also helped to lift sales and it now has 150 outlets worldwide.

However, global like-for-like sales - which ignore the impact of new stores - fell 0.8%,

Celebrity approval

Jimmy Choo produces a wide range of luxury items, from handbags and scarves to sunglasses and perfume. But shoes remain its core product.

Celebrity fans of its shoes include Diane Kruger, who didn't put a step wrong in her Jimmy Choos at this year's now infamous Oscar ceremony.

The fashion brand also claims La La Land Oscar winner, Emma Stone as a devotee.

Image copyright Getty Images
Image caption Best foot forward - Jimmy Choo claim Emma Stone as a long time fan

It said the breadth of its range allowed it to capitalise on the renewed popularity of the luxury trainer, leading to particular success with the Miami trainer.

During 2016, a further 16 of its new directly-operated stores were refitted, which it said continued to outperform those in the existing format.

Its online business now accounts for 6% of revenue.

Image copyright Jimmy Choo

Revenue fell in the US as it repositions its business along with a fall in demand from department stores.

Terror attacks in Europe reduced spending by tourists and slowed sales, but it said trends improved in the second half of last year.

It said the drop in sterling following the UK referendum to leave the EU, had an impact on "the financial results and client purchasing behaviour."

It added that exchange rate moves remained a concern, but the lower pound had attracted foreigners to spend in London.

Fiona Paton, retail analyst at GlobalData said: "The retailer's reported high revenues were largely a result of currency changes during the year, which caused both sales values gains and changes to shopping patterns, as tourists favoured buying luxury items in the UK."

She said, Jimmy Choo's strong British heritage had struck a chord with consumers in Asia, unlike some other luxury players, but the greatest concern was in the tough US market where it needed to develop more innovative marketing.

"The retailer should look to create more creative campaigns and hire a well-known brand ambassador to gain more relevance and excitement," she said.

Image copyright Jimmy Choo

Pierre Denis, chief executive of Jimmy Choo, said: "2016 was a landmark year for Jimmy Choo.

"Not only did we successfully celebrate 20 years of heritage but record revenues and profitability are testament to the growing appeal and strength of our brand.

"We will continue to deliver on our long term strategy of growth through the creative and innovative development of our collections and the sustained expansion of our distribution network, particularly in areas such as Asia where we remain underpenetrated."

The brand is trying to broaden its appeal, investing in revamped shops, new websites and distribution networks.

Tom Gadsby, Liberum analyst said: "The company's outlook is strong.

"Retail trends are improving across all regions and Choo has a very strong growth prospects across all its channels.

"We are encouraged to see the strength of the company's retail business following sensible investment and there remains plenty of scope for further store expansion," he added.

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