Profits at the Ermenegildo Zegna group more than doubled last year as demand for the Italian luxury company’s menswear and accessories grew, defying a wider slowdown in the sector.
The Milan-based group, whose brands include the eponymous Zegna, Thom Browne and Tom Ford’s fashion arm, said on Friday that net profit in 2023 reached €135.7mn compared with €65.3mn in 2022. Revenue over the period was up 27 per cent at just under €2bn.
The group said profits were mainly driven by its Zegna and Thom Browne brands. Zegna’s triple stitch luxury trainers which have a starting price of more than €800 and Thom Browne’s flagship short trousered men’s suit were among its best sellers, according to the company.
Chief executive Gildo Zegna, who is also the founder’s grandson, said it had been a “milestone year”.
The Zegna group in 2022 agreed to take over Tom Ford’s fashion arm from US-based Estée Lauder, which the chief executive said had “enriched [the group’s] proposition in luxury glamour”. It is now in the process of completing the integration of the brand.
After listing three years ago in New York, the 114-year-old Italian group — which is still controlled by the founding family — worked on diversifying its traditional offering from high-end formal menswear to cater for a younger and more informal generation of consumers.
Luxury menswear brands that have struggled to update their offering from traditional formalwear, such as Kering-owned Brioni and Ferragamo, have found it tough as consumers shifted to more modern and sportier wear.
Since taking over US label Thom Browne, a favourite of Michelle Obama, the Zegna group has also expanded into womenswear and its recent collections have showcased multiple gender neutral pieces.
Zegna said the group must continue to be “responsive in the current volatile world”. Its shares have climbed more than 16 per cent since its 2021 listing.
Analysts expect the luxury market will slow this year after several years of record growth and profits, with the trajectories of the strongest brands increasingly diverging from their weaker peers.
The chief executive said the group would continue to focus on its in-house supply chain following the acquisition of several high-end textile producers in Italy, including the latest footwear and leather goods production facility in Parma, which is expected to complete by the end of 2026.