Prada SpA fell to the lowest level in more than three years after the luxury retailer reported first-quarter profit that trailed analysts? estimates as it struggled to reverse slumping sales to Chinese shoppers.
Prada shares dropped 4.9 percent to close at HK$37.80 in Hong Kong trading, the lowest level since February 2012. The benchmark Hang Seng Index fell 1.5 percent.
Net income in the three months through April plunged 44 percent to 58.7 million euros ($65.7 million), Milan-based Prada said Friday in a statement. That?s almost half of the average estimate of 85.2 million euros from eight estimates compiled by Bloomberg.
Hong Kong and Macau ?will remain challenged for at least six months,? Nomura Holdings Inc. analysts led by Christopher Walker wrote on June 14, adding sales trends remains difficult and maintaining a ?reduce? rating on the company.
The maker of $695 clogs and $860 wallets is opening fewer stores, shuttering some wholesale accounts and introducing more bags priced between 1,000 euros and 1,200 euros as it attempts to reignite demand amid a clampdown on corruption and extravagance in China.
First-quarter revenue rose 6.5 percent to 828.2 million euros as the weakness of the euro compensated for anemic growth in the Asia-Pacific region, Prada?s most important market.
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