Luxottica Q3 numbers

We had numbers from Luxoticca on Wednesday. If you need reminding they are the guys that make sunglass brands Ray Ban, Prada, Oakley and a whole host of other brands. Over the past few months, most of the companies that we have written about talk about strong dollar head winds, Luxoticca is a European company which results in strong dollar tail winds instead. Group sales are up 15.4% compared to the same quarter last year but if we strip out the strong dollar tail wind, sales are only up 5.5%. If we look at EPS, in Euros it is up 19.8% but in US Dollars it is only up 0.5%.

Here is a breakdown of the sales in each region and their respective weighting for the business:



Note the solid growth in North America, which is a good indicator of how things on the ground for the consumer have improved. A key figure to look at though is the Asia-Pacific region which only accounts for 13% of sales and if you drill down further China only accounts for 3% of sales. Given that figures from China have been showing a strong shift to consumption (Apple and Nike both confirming this with their numbers), China is going to be a key growth market for them. Consider that China has 30% more people that both Europe and the US combined, so a region that will grow with in significance.

Then the last number of interest was that they grew their E commerce sales by 50%. Most people I know try on many pairs of glasses before they buy a pair, maybe this is people who are buying glasses they have already tried on in the shops? The stock is not not cheap, trading at a P/E of 30 for next years expected earnings. The reason is due to the huge growth that is expected to come out of China, which at the moment can be considered a blue sky market.