Full Year 2022 Ermenegildo Zegna NV Earnings Call
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My name is Bruno and I'll be the operator of today.
During this presentation you can register to ask a question by pressing star followed by one on your telephone keypad.
I will now hand over to your host. Francesca has passed Antonio, please go ahead.
Hello everyone and thank you for joining us as we share our full results for 2022. I'm here today with the Jesus Deina, Group Chairman and CEO , as well as our CEO and CEO of the United States.
Happening web and about am feel of storm ground, we fil today our 20th form and we've also filed.
which is the customary conversion from the previous F1 form.
Before we begin, I need to point out that we may make certain forward-looking statements during today's call. Our actual results may be materially different from those expected or implied by these forward-looking statements. All such statements are subject to a number of risks and uncertainties.
Including those discounts in our asset definitions.
I refer you to the Safe Harbor Statement which is included on page 2 of today's presentation. And of course this call will be governed by the language.
I'm pleased to now hand over to Gilda.
Thank Wards minter and know to everyone, I'm very happy to share that we ended another strong year.
And ours out for 22 reflect the strong momentum and the availability of Zani on Brown brands.
As well as the soundness and success of our strategy and execution.
Last year we kicked off the rebranding of Genia, unveiling the Genia One brand and strategy, which has seen excellent success with customers of ours around the world.
We are still early in the rebranding journey. I mean just launch our second season.
And however, we have a number of initiatives to continue building on Zena's success and are enforcing its position as one of the Wards of Laxll brand and the leader remains well.
Some brown continues to show stroke performance also.
And besides the numbers, we are very proud of the great reaction. Some brown Paris and New York shows that have been received last year, as well as this year from customer, the media and influencers.
And of course, no discussion of our 22 is complete without mentioning our very exciting partnership with the StellarDev companies for the total four fashion business.
We expect the deal to close in a few weeks, at which time we will be able to share more about our plan for this top brand.
So far 23 has been off to a very encouraging start.
With very solid double-digit performance across our retail network for buania and somebrwn.
I'm optimistic that the reopening of the Greater China region combined with the positive response we are seeing from customer to our collection across our global network.
And in particular European and American customers, we continue to drive our growth this year.
And we are particularly excited by the progress of our major business, which is up double digits when compared with 2019 that was already a top year.
We expect that our results for 23 will confidently show that we are on the trajectory to meet our goal of annual revenues exceeded 2 billion euros. And the adjusted AB margin of at least 18 percent.
By the end of fiscal 20-25, excluding the top-four fashion business.
We will continue to execute for our strategy that aims at strengthening our market-leading position.
and pioneering new high-potential markets.
as Saudi, as Central Asia.
as Southeast Asia and India. And we are also, as always, working to strengthen our main needs, a re-murupatch platform, with projects aiming at expanding our production.
capacity in footwear as well as in
Floating manufacturing, plants, adding up to three under people. So our Italian workforce and...
plants, adding up to three under people. So Italian works work force by the midterms.
Mainly, Italy manufactured reaction remains a priority for us today. 113 years after the foundation of the company.
And in this regard, I am also proud to remark that we have launched Aca Zilia de Mesieri, our vocational training project.
And academia will focus on skills and expertise in textile clothing and leather goods within the group.
and is part of our sustainable growth strategy to ensure excellence and innovation in theOO impact suite.
If you would now please turn to page 4.
I think that I'd like to turn to some financial highlights of 2022. Waujaluka will go more into debt later in this call.
As we discovered in January , our revenue for the year was almost 1.5 billion euro, an increase in cost of currency and a $0.5 increase over 2021.
In line with the mid-team guidance we have shared, excluding the Greater China region, which was heavily affected by COVID-19-related restrictions in the second and in particular for fourth quarters, our revenue grew 42% in 2022 over 2021.
with strong performances by US and European customers as well as consumers from the Middle East.
Our profit was 22, and it is 65.3 million euro. And adjusted added at 157.7 million euro, which is up 6% from the previous year, in line with our guidance of moderate improvement.
Adjusted APID margin came in at 10.6%, down 90 basis points from 21, due to increased costs and the negative impact of COVID-19 disruption in Greater Schwann.
We shall look at what we discussed in more detail, which were partially offset by healthy and healthy health.
Our cash surplus at year end was 122.2 million euro, down 16 from 21, but reflecting cash generation in the second half of last year in line of guidance. And Gianluca will give you more details on this point later on as well.
Now please turn to page number 5.
And in looking at our journey over the last two years, 2022 showed continued sales growth and healthy profitability even as the global environment continues to be uncertain. And as Greater China was hit with temporary store closure, the COVID-19 related restrictions.
As I said earlier, we are seeing the reopening in the area that China already has a positive year, which we believe will continue for the rest of the year.
Now, please turn to slide number six.
I'd like to talk to some pilots for last year. As I mentioned, the Xenia One brand has proven successful with our customers since we launched it in July of last year.
We see increased demand for our current product.
especially footwear and our luxury leisure wear, that continue to perform very well, proving the soundness of our decision to focus on luxury leisure wear as a pillar of our leisure business.
Meanwhile, we also see a continuing bond in formal wear in line with the return to offices and the up-stick in demand for menswear for social and special occasions, in particular evening wear.
Our relationship with our customers is one of the strongest drivers for our success.
We always prided ourselves on providing excellent customization in the product and service.
Our CRM is becoming more sophisticated and last year our direct customer engagement was responsible for driving 35% of the revenue of our boutique worldwide.
Our proprietary clientelling application, which we have remained silent exit, is continuing to see an accelerated allow, and this provides an exciting new channel for us to build on and strengthen these relationships. And, as set today, the business generated through these outreach approaches.
reached 50% of our boutique revenue.
I have two years to the topic. Our research represents a powerful tool to decept the man and capitalize on the increasing popularity of our collection and iconic product.
Tobrown also had a number of miles saw. Last year, the brand added 11 net new directly-operated stores around the world, bringing the total to 63 doors and 105 poder sales. The video will now give you some color on Tobrown. Thank you.
So, thank you, thank you, jail. Similar to the world of the and, although we come from different cases and different backgrounds and different amount of years in the market, we have equally important customers and facilities on the ground. So, we continue to strengthen our client value management.
Transactions were very, very focused on these; our main goals going forward are two: one is the big expansion of awareness, and second, only a big, significant expansion on client. In order to support that, we do believe that we have an exceptional product and exceptional client, and we.
As well as four Korea, as soon as we take over the business in July.
As the brand continues to grow in conditioned presence, we're also keeping our marketing investment to expand significantly uncorner base. We have been extremely pleased for the reflection of our shows both in new yupke and Paris over the past nine months.
Starting from this summer, we will be celebrating 20 years at Brown, which allows us to have a fantastic opportunity to celebrate globally with events, including those in different parts of the world over the following 12 months.
And with these I would like to pass back the rules to Jesus. Yeah, thank you Rodrigo. I must add that 22 also saw us continue a journey of caring for our employees, the environment and the world around us.
People was a key theme during 2022.
In keeping up with the commitments, we announced that our Capital Market Day in May, we developed a number of B.E.N.I. and Talent Management Strategies, including hiring our first B.E.N.I.
In the year, we have also learned to win F the interestcy.
For a greater number of employees, and, as I anticipated earlier, we are also investing in their academia as part of our approach to preserve and valorize our tradition of manufacturing excellence and our expert know-how while extending professional opportunities to young people.
When it comes to care for the environment, we met a number of our commitments last year. First, we submitted our net-zero target to the Science-Based Target Initiative, a big step in ensuring that we are fulfilling our role to combat the climate crisis. We owe it all to cashier and we are committed.
To hand old cash M used in, nor the cashm collection to be fully traceable by next year is certified by Sustainability Fiber Alliance.
This is one of many steps on our road to passability, leading to our long-term commitment of having at least 60% of our raw materials traced to the geography of origin, and coming from lower impact sources by 2026.
Finally, we know that having sustainability as a whole of everything we do is not just about what we do as a group, but about what professions the industry does collectively.
is why we joined a number of partners to spare head among others to the industry sustainability project last year. First, we joined the Camera D'Antonale de la Monro Italiana and the number of other Italian Lapsheets brands used the Rekrea consulting to manage product and supply.
We want to join the Fashion Path and the number of global fashion brands in the collective virtual department for the Green, which is accelerating the adoption of a new model and the policy details that fashion is doing. Please now turn to by the age member 7.
Before I end over to look after a deeper dive in the database, I want to share just a few recent events that we've announced over the past few months.
In February , we completed the redemption for group awards, outstanding as of February 27, 2023, resulting in a total number of outstanding shares of about 248 million and a minimized delusion of around 2.3%.
On January third, we announced an agreement approaching a minority stake in Canadian technical tree running company, modern adoption, to gradually increase our stake over the next laxurial outdoor as.
Each part of luxury leisure work continues to be an area of focus for us.
And nor Ther I M using the finance material to produce all-weather footwear of the highest quality, which aligns perfectly with our value of creating the best product.
from the best material. The agreement also provides us with the strong enough to encourage the partner in the exciting potency of the future. And I must tell you that since the show has been announced a few months ago, we so far we really had good marketer the reaction.
across the board.
The Xenia for Winter 23 collection also had two very exciting features. First, the 70% of the collection was created using Ozy Kastmier, which besides being a central development on our road to transability, also reflects our focus on quality and using the best material available to create our products.
Second, we presented a full collection in partnership with Los Angeles-based The Elder Statement, which was based on the strong relationship between our very own artistic story and Greg Sheehy, the brand founder.
Finally, the lach obgx. A couple of weeks ago, we set another milestone in our Ro digital, adding a powerful may to measure propaborator, which will further enhance our customiz leoff.
Thank you, and now I will go over the recent events from Brown, led by Rodrigo Thankgo.
Breina.
Yes, some here. Yes, M saw the return of some ground. The near fashion week, we saw an exceptional four into '23 collection, both in the UR and in the showroom staff, which has.
A great opportunity, with the show having a very significant coverage, that of attendance and also of press. We would like also to do this opportunity: people convivially, Tom on this congratulation and the return to your fashion week, supporting it being right now the Chairman of the CFDA.
In respect to the lawsuit filed by Adidas in the US, Tom Brown faced a jury trial in January in New York whose outcome was that Tom Brown did not infringe on any of the trademarks of Adidas America.
This was a jury decision that came out within a very short amount of time right after almost a couple of weeks of trial. Another exciting development to run in line with the continued worldwide growth is the agreement with the Korean partner of two years, which is Samsung C&T Corporation.
Through which door will Donbr directly operate the Korean business in as of July, first from run, Korea will assume direct responsibility. Posctivity in Koreer.
which is 17 directly British stores turning 18 directly British stores later this year. So we will fully all fully be fully owning the business in Korea and will continue the partnership with San Sun which is a very innovative, we believe, vehicle management agreement.
With Sam, we had never set an agreement in an auction, but having one of the most exciting results in the planner, which is currently South Korea, today run by one of the most.
One of the strongest talent teams in Korea is the Stam Sun CNT team. Running the business had an exceptional job: bringing our business right. I was fully on it.
And with that, I'll pass the award to Geluka to go through the financial 50th year.
Thank you, Rodrigo. It's thank you all for joining us today.
Page 8, let me start by reminding briefly where we stand in terms of revenues as we disclose in January revenues for a year were likely under 1.5 billion euro, an increase of 15.5% over 21 in actual terms.
and 11% in cost currency. Both Zany and Albron segments continue to show good momentum despite the COVID-19 disruption in China, the second and fourth quarter. This disruption has generated a kind of two-speed world in our business last year.
and we want to point out our please 42% growth year over year out of greater China which has benefited from these.
success of the brands and the expansion of the footprint, especially on the Tom Brown side. We remind you also that the fourth quarter of 2022 saw the impact of the termination of the distribution of the virus.
on menswear with Tom Ford which also affects part of 2023 until the integration of the Tom Ford fashion business will take place with the closing which as Guido was mentioning before is expected to happen in the second quarter of this year. At that point this
decline of the termination distribution will be compensated by the line-by-line integration of stone quartz.
of determination distribution will be compensated by the line-by-line integration of the Run Fort Bo tem 82 page 9
Profitability, the adjusted EBIT for the year was up 5.8% from 2021 to reach 157.7 €, compared to an adjusted EBIT of last year that was 90 base points higher.
and this year we get to a 10.6%. The decrease in the margin was due to the following factors. First, the step up in marketing costs for both brands which we anticipate in the capital market space.
and which will slightly continue also this year. It's a journey. Second, in increasing what we call, and you will see in the new approach of segment reporting, corporate costs.
Which have been allocated to a new dimension of segment reporting - and we will discuss this shortly - are an 11 million increase.
Third, the cost related to the SOPS, which occur in both the Zener segment and the Tom Brown segment.
Finally, which is the biggest impact, if the coveive related disruption in Greater China in the second fourth quarter of last tiyear, which created an unfavorable geographical mix effect, this, as created, as I said before, the largest impact and, if we want to turn into 2020, right becomes.
an important tailwind for us adding into this new year so it becomes like a credit.
from the recovery of China. This has been all partially offset by an important improvement in the profitability of the business everywhere else, in the other geographies and in the other product lines.
Adjusted profit at the end end at €73,000,000.60 million, likely down from €75 million of last year despite the improvement at the operating level that I mentioned before, due to financial items and financial charges, which I will mention and call out specifically.
because they are peculiar, the increase of put optional liability and warrant liabilities for a total charge of 23 million in 2022 P&L.
as well as financial charges related to portfolio results in 2022 compared to a profit in prior year.
We note that after the redemption, the ups and downs of warrant liability will...
Get out from our PL, but only from 2024. Meanwhile, in 2023, we expect the redemption of warrants that occurred during the development to have a negative one-off impact that we estimate to be in the range of two thousand to six million. This is coming from the mark-to-market value of the warrant redemption compared to the.
A fair value. That was posted at the end of 2020.
Group profit for 2022 came in at $65 million compared to a loss of $127 million last year which was primarily attributable to the cost incurred in connection with the business combination with the SPAC.
Now moving to page 10. I don't want to grow - well, in my line - into this.
Finan income statement, but this is just to anticipate that this current shape of our income statement, as we had the chance also of.
Talking with some of you along the way, we are preparing to transition to a representation of cost by destination in 2023, which is much more common in the industry. This will allow us to report the gross margin, which, in our current structure.
The income statement is not visible. So this will happen with the first half results and we hope to be able to provide you with a pro forma of prior years when we release our first half revenues at the end of July.
Now let's discuss the profitability by segment, starting on Page 12 with each segment that is involved in both of the Za brand - the textile business - and third-party products. That is, when we produce for other brands like Bl Citania.
and before and it was also pumped for.
We mentioned in a prior announcement that we have traditionally allocated corporate costs to the line segment, negatively affecting this segment's profitability. Now, as I anticipated before, we have started to report corporate costs separately.
Separately, and we will discuss this shortly. Under this new approach to segment reporting, the adjusted EBIT for the Veninus segment came in at 141 million, up 7% from the prior year, with the EBIT margin of 12% compared to the 12 points of the prior year. The ZA one brand strategy and our positioning improvement.
And ire debrtation in the mortizvation.
If we go to Page 13, the Tom Brown segment saw an improvement in both the absolute adjusted EBIT as well as in the margin. The adjusted EBIT for that segment was up by a strong 26% to reach 48 million euros, while the adjusted EBIT margin increased.
From 14 four cent, 14 5% in twenty thousand per as, we continue to invest in the growth of Tom and scale benefits are contributing to the improvement on the other side of the world. Parti partially offset by growth of related expenses, including the expansion of the store network by net 11 do.
Higher marketing costs as SP Lania and investments to improve central processes within Incombround.
Page 14. Now we come, as I said before, to the topic of corporate cost. This cost includes activities and functions belonging to the holding that are not attributable to either V or a number of segments. This cost, as I said, was previously included in the same effect.
This cost has increased significantly following the company's public listing in December . Primarily they relate to the board.
The cost of functions with our centrally managed on behalf of the entire group, such as group Council, turnholded in that relation, central finance, the insurance coverage for Directors and offices and so on, for twenty-pointy-two corporate cost came in at thirty-one point nine.
are posted directly in the Xenia and Tom Brown business and these are related to the SOPS compliance within the operating legal entities of the two segments.
Going to Page 15, some details on cash position and Remade to cash situation to our CapEx and working capital. We ended '22 with a cash reserve of one hundred and 22 million, up compared to the midyear of one hundred and three million, in line with the demand.
and down from 144 million at the end of the year. If you want to break end of 2022 compared to end of 2021, these are the driving factors.
We paid within year 26 million dividends, not only the dividends to the NV shareholder, the NV, but also to other...
minority shareholders of
minority shareholders of controlled entities.
703 million in payments for CAPEX, mostly limited to store network. The size mostly is remodeling and the ground is mostly expansion. But it would also like to fly IT investments, investments in manufacturing plants to expand capacity. A couple of examples we are expanding about the unit and outer work.
Of revenues around two thousand, 1% and 33 million real estate settlements on stores. This DNL charge had already been accrued prior to 2020, but saw the cash outflow for.
Some settlements related to Medagicine Avenue GI, the store, or Romakcondoti, taking place in 2022. As we look at it, we believe that we have worked carefully on the optimization of our store networks, and so most of rationalization has happened at this point.
As we see the specific part of the trade working capital, it's important to understand what happened to the inventor in order to be not concerned. A significant portion of the increase was planned. There is a part of the increase related to our desire to secure the capital.
availability of Essentials. Essentials is the continuity part of our Zegna brand which is aimed to be never out of stock. So we made a step up one off of the availability of Zegna Essentials. And of course there has been the part that was unplanned related to the fourth order.
of China which has lacked some stock, which we believe with the reopening of China now has become an opportunity in order to capture an increase in demand and so we don't see the
Any problem on the Investor RE coming from China. We expect this excess at the end of 2002 to be quickly absorbed.
in this last month and next month. So now I give it back to Jim just to talk about this. Yeah, thank you Gianluca, that was a very clear explanation. Finally, let me share a quick update on our dividends. And subject to the required approvals, we intend to make a dividend distribution of zero.
per share, it's 10 cents of a euro per share, to the holders of ordinary shares, a total of approximately 25 million euro. This will be decided to our next AGM.
Which is currently expected to be held on June twenty-seventh. Now I'd like to talk briefly about our outlook for 2023 and beyond.
And at our top of the market Day last May, as you recall, we shared our medium-term target for the group, excluding the integration of Talward Fashion, of course.
Which was, namely, revenue of 2, medium growth, the adjusted EBIT margin over at least fifty percent as by share at the top of the call. We now defined medium term as the end of fiscal year twenty twenty-five.
For 23, we are encouraged by the start of the year, which is well above our expectation, with broad-based strength, a very dynamic made-to-measure business which well exceeds the prior cost level of both 22 and twenty-thousand eight.
And here, tourists turn to Europe and key Asian hubs like Hong Kong and Macau, which I think is very important.
We expect that our 2023 results will show comfortably that we are on the trajectory to meet our ambitions.
Go by the end of 25, again excluding the integration of Johnfort.
This is acknowledging the ever-changing environment with macro and financial markets volatility but assuming a further significant geopolitical, macroeconomic or financial market deterioration. No further disruption linked to the COVID-19 pandemic and no other unforeseen events. And with that, we are ready to answer any questions you might have. Thank you.
Thank you, Gino. We are ready for the Q&A session.
Let's see female.
Perfect. Ladies and gentlemen, if you'd like to ask a question, please press star followed by 1 on your telephone keypad now.
Press the star key, followed by 1, on your telephone keypad. Okay, we have our first question. It comes from Susie Tibaldi from UBS. Susie, your line is now open. Please go ahead. Thank you so much for taking my question. Congratulations on another strong year.
On your comment that you had a very good start of the year 2023 and that Q1 is expected to grow double digit with a very broad base strength, could you give a little bit more detail in terms of the growth that you're seeing by region?
In China, I'm sure you're seeing a very strong rebound. If there is any way you can help us understand what kind of rebound you're seeing there, maybe give some number, it would be super helpful. And also, you said this strength is really broad-based. We are hearing from some of your peers that in the US,
There is a little bit of weakening consumer sentiment. Is this something that you're seeing as well? And also comment on Europeans would be super helpful. And my second question would be when you're thinking about the investment that you're planning for 2023, is there any kind of step up in investments that we should think about in Southern Australia?
Is there any specific areas that you feel like it's necessary to keep investing and if there is any project that you have planned for 2023? Thank you. Hi, it's Luca here. So in terms of numbers, we cannot anticipate what we are going to disclose at the end of the month.
Solid double-digit. Solid double-digit, of course, then becomes double-digit when you are also taking into consideration that Tom for the fact, which slows down the number, because last year we were still distributing Tom for in Q1.
Solid double digit of course then becomes double digit when you also take into consideration the Tom Ford effect which slows down the number because last year we were still distributing Tom Ford in Q1. So looking at
Retail is solid double digit across the regions. We are seeing solid performance everywhere. Also in West, which I'm fully aware someone is not seeing, we are not having this
Feeling our performance is solid throughout Q1 in retail for dia, namely for dania, mostly Dana brand.
So that is the picture I'm going to give you. In terms of investment...
We expect 2023 to be slightly higher than 2022 in terms of amount.
This, of course, comes with the continuous footprint expansion on the ground. We are seeing some perimeter opportunity in India.
Which is a piece of news, because so far we took advantage of traditionalizing the network in Veania. Also, with the discontinuation of .zia, now it's time for us as we see the opportunity for expansion.
In North America, in new parts of Europe, in some parts of Europe, and in China's build.
Some tactical growth, so we will make a step up in terms of CapEx in 2023 and, as I said before, also invest in the supply chain. We believe that our supply chain is a strength for us.
We are investing, we have been investing in 22 but we continue investing in 23 in expanding our internal capacity in some product lines.
And so this will become a further driver of investment together with
Investment in the direction of digitalization. As we have anticipated, the nyact.
The tool of TRI operator, which will be presented directly to the community in a few days. That would also be an area of direction of investment for the group. I want negatively.
deep sense that anyone has attempted to hit themselves above the notch will actually say it especially for those who know me a better?.
Quite unexpectedly, I strongly agree with the board, as I said. But I think there is a reason, just not on Gany Road. I think that all our strides to become sophisticated retailers, in terms of product merchandising, in terms of marketing, in terms of personalization.
in terms of digitalization, a new way to reach out to the customer is bringing some good results and we are extremely pleased about this outreach, you know, new process we have which has become part of the cost of our retail in that Metro, which is quite a lot of people.
of Danya and we are getting really good good good traction both.
by the law customer to make a measure, the measure measures, research on fire, being with make a measure of the level of mentee, which were quite at the peak, I mean, quite positive, both on the tailoring side and also the leachers side, and then all the accounting development is bringing it as out. So you just, visit that was so, and you see.
what we have put together last year.
I think that is one of a few problems.
Yes, yes, that's great. Thank you so much and we look forward to the Tom Ford integration as well. How would you avoid that? We are in a few weeks away hopefully.
So, Bruno can we... Yes, just a reminder ladies and gentlemen, if you would like to ask any more questions, please press star followed by one on your telephone keypad. That's star followed by one on your telephone keypad.
We'll just wait a couple of moments. We do have a couple of questions coming in. The first question is from Louise Singlehurst from Goldman Sachs. Louise, your line is now open. Please go ahead.
Hi, good afternoon everyone. Thank you for taking my questions. Just following up on the China question from earlier, I wondered if...
You can help. And you'll leave your voice sorry, because we hear you very far away, sorry. Apologies, is that a little bit better? Thank you. I was just going to follow up with a question with regards to China and thank you for the But can you help us think about?
the attitude of the Chinese customers that you know which are already shoppers at the brand. You know, the appetite for spending. I suppose what we're all trying to think about is the reopening and the appetite of the consumer to spend versus save.
In terms of a luxury environment, I wonder if there's any color that you can give us on the customers that you may well attract by the end of the year. Secondly, just on the broader rebranding and the new initiatives, can you help us think about the number of new customers that you think you're adding to your customer base from the customization and digitalization initiatives?
for the summer. Listen, the biggest surprise is on Kog and Macau, which he was not a given. To be honest with you, during the first visit, but it was after second, where I got to understand the Chinese were finally free to move around, also outside their boundaries.
and that Hong Kong and Macau would have been the first destination for sure. Then, I remember on the list, Japan was, Tokyo was top on the list, Bangkok and Singapore, and we see this happening. This is literally what's going on now.
predicting whether this trend will hold on for the rest of the year, whether they will be traveling also abroad outside the boundaries, even more so of Asian territory. I don't know. We played that they would stay in Asia, so we think that we will see them.
more, for sure, 24. We are ready for that. But right now, we arrive the results in the Greater China region and in some territories in Asia.
Now in terms of more color malic, I think the like our color, like the new car of the brand, and I they go, they go for numwness. I mean, I just can tell you know we just came out with a e knowitional collection and it's planning these days on the market and you know just, we just Co that.
And we just shipped the preferred shot of, nor the shoes, and they found fire. So whenever newness you send to them, their response, and I tell you, I tell you, I mean we're talking not only about lawyers, their capital, we're talking about newness. And I can tell you in the iconic front of, I would say.
at least between 30 and 50 percent of the purchases are with new customers. So we have a lot to do in the next months and season to make sure to surprise them. I think that what we remember and we saw last year quite...
often about collaboration. I think that this collaboration I think is a very smart move in terms of marketing, in terms of adoring them to come back and to make sure that whenever they come back and they visit often they can be destroyed. I think that one of the things that they can do is they vision.
the store more often than any other consumer. We see this happening again. As a matter of fact, traffic is up, not yet to where it was at the peak of 21, but surely nicely up and under, I would say, low double digits. But I think that the important thing is to make sure that they are surprised every time they visit the store.
you know, surely he's doing that and he's coming back.
That that's a very good newic and that's why the gener that we was saying we are strengthening our tailoring supply chain, we can toly make sure in the production because we just are know, we just want to keep up. You, we have a two do boring delivery.
cycle there according to the speed we want to give and we just want to make sure that we keep being on top of that. So I think that overall I mean pretty good news and there is no reason why it should slow down and the rest of the year we remain a bit overall in particular in China.
In the area, what we see doing is Joh high, and where we see, of course, the new client coming into the brand are definitely the new iconic products. So to this dishes, thatfinwe be an entry door.
Nitware is becoming an important entry door to the brand. Nitware, whether it's cashmere or cashmere and silk or the new medium Nitware is becoming an important entry door and overshirts are the new
They constructed. Whether it's a short or a JAC decision, but those new items are becoming attractive.
Hope for a plan to explore them as a new brand for that, but does it answer certain ways? That's perfect. Thank you very much for the color, very helpful.
Thank you. Bruno, can we move to the next question please? We currently have no further questions, so I would like to hand over a back to you. Okay, so thank you very much. Everyone for listening to the call.
Our next reporting is going to be the first quarter results on the 20th of April , and there will not be the conference call because we have just given you the freshest update. I will be available.
In order to discuss the PR release of the first quarter results together with the management, should you have any last questions.
Happy holiday and pak on like every Sha world on biking.
Ladies and gentlemen, this concludes today's call. You may now disconnect your lines. Thank you.
Thank you, Bruno. Thank you. Thank you.