H1-23
Results Presentation

Milan, July 27th 2023
1

July 27th 2023

Disclaimer
The information contained in this document is for information purposes only and does not constitute an offer, solicitation, invitation or recommendation to subscribe for orpurchase any securities, or other products or to provide any investment advice or service of any kind. This document is not directed at, and is not intended for distribution toor use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject Prada S.p.A.
(“Prada”) to any registration requirement within such jurisdiction or country.
This document may contain certain forward-looking statements which are based on the current expectations, estimates, projections, beliefs and assumptions of Prada about
the businesses and the markets in which it and its subsidiaries operate. These forward-looking statements are not guarantees of future performance and are subject to risks,
uncertainties and factors beyond the control of Prada. Therefore, actual outcome and returns may differ materially from the assumptions made and the statements containedin this document. Nothing contained in these forward-looking statements is, or shall be, relied upon as any assurance or representation as to the future or as arepresentation or warranty otherwise. The forward-looking statements only reflect Prada’s views as of the date of this document, and Prada does not undertake to revise or
update these forward-looking statements.
Although the information contained in this document is obtained or compiled from sources believed to be reliable, this information has not been independently verified. This
document may contain data which have not been audited or reviewed by Prada’s auditors and may be subject to change and adjustment. Certain information in thisdocument may be based on the Board’s preliminary review of the internal data currently available and gathered by Prada only and is not intended to be a comprehensive
statement of Prada’s financial or operational result.
Prada does not guarantee, and no representation or warranty (express or implied) is made as to, the accuracy, fairness, validity, timeliness, reasonableness or completenessof the information or data for any particular purpose, and Prada shall not accept any responsibility for, or be liable for, errors, omissions or other inaccuracies in theinformation or for the consequences thereof. Neither Prada nor any of its directors, officers, employees, agents, affiliates, advisers or representatives shall be responsible or
liable for any loss or damage, directly or indirectly, arising from the use of or reliance upon any information provided in this document or otherwise arising in connection withthis document. The information presented or contained in this document is subject to change without notice and shall only be considered current at the date of this document.
IN NO WAY DOES PRADA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED
IN THIS DOCUMENT. INFORMATION IN THIS DOCUMENT SHOULD NOT BE CONSIDERED AS ADVICE OR A RECOMMENDATION TO INVESTORS OR
POTENTIAL INVESTORS, OR FORM THE BASIS FOR ANY INVESTMENT DECISION, IN RELATION TO HOLDING, PURCHASING OR SELLING SECURITIES OR
OTHER FINANCIAL PRODUCTS OR INSTRUMENTS AND DOES NOT TAKE INTO ACCOUNT YOUR PARTICULAR INVESTMENT OBJECTIVES, FINANCIAL
SITUATION OR NEEDS. BEFORE ACTING ON ANY INFORMATION YOU SHOULD CONSIDER THE APPROPRIATENESS OF THE INFORMATION HAVINGREGARD TO THESE MATTERS, ANY RELEVANT OFFER DOCUMENT AND IN PARTICULAR, YOU SHOULD SEEK INDEPENDENT FINANCIAL ADVICE. ALL
SECURITIES AND FINANCIAL PRODUCT OR INSTRUMENT TRANSACTIONS INVOLVE RISKS, WHICH INCLUDE (AMONG OTHERS) THE RISK OF ADVERSE OR
UNANTICIPATED MARKET, FINANCIAL OR POLITICAL DEVELOPMENTS AND, IN INTERNATIONAL TRANSACTIONS, CURRENCY RISKS.

2

July 27th 2023

AgendaPatrizio Bertelli - Chairman and Executive Director
Highlights
Lorenzo Bertelli - Marketing Director and Head of CSR
Key Marketing Initiatives and ESG Update
Andrea Guerra - Group CEO
Business Update
Andrea Bonini - Group CFO
H1-23 Financial Review
Andrea Guerra - Group CEO
Closing Remarks
Q&A Session

3

July 27th 2023

Strong brand identity, creativity anddisciplined execution drive positive results

Positive Q2
on top of solid Q1

Net Revenues€2.2 bln+20% constant fx

High quality
Retail Sales growth
driven by full price,
like-for-like sales

Profitability increase
coupled with higher
investments

Acceleration of capex
plan for the growth oftomorrow

Retail Sales€2.0 bln+21% constant fx

EBIT Margin22.0%€491 mln

Capex€151 mln

Clear strategy and strengthened organisation to tackle ever-evolving demand dynamics

4

July 27th 2023

AgendaPatrizio Bertelli - Chairman and Executive Director
Highlights
Lorenzo Bertelli - Marketing Director and Head of CSR
Key Marketing Initiatives and ESG Update
Andrea Guerra - Group CEO
Business Update
Andrea Bonini - Group CFO
H1-23 Financial Review
Andrea Guerra - Group CEO
Closing Remarks
Q&A Session

5

July 27th 2023

Prada brand continues to resonate
With a solid and above-market search trend on the web

Continued successof fashion shows• Prada Menswear FW23 and SS24
as well as Prada Womenswear
FW23 fashion shows with excellent
reception by all audiences

Exceptional personalities
drive campaigns allurement

Brand exclusive
collaborations

New and consolidated formats
elevate the brand experience• Through “The Glass Age” campaigncelebrates the Prada Galleria with
Scarlett Johansson bathed in
expressive color by Venezuelan
American artist, Alex Da Corte• Prada and Adidas unveiled the"adidas Football for Prada"collection, which reimagined threeleading adidas products: Predator
Accuracy, the Copa Pure and the X
Crazyfast. The design codes of thecollection were showcased throughan exclusive kit for the FIFA 23
Ultimate Team video game

• Prada Extends music formats curated
by Richie Hawtin landed in Bangkok
involving local artists in live
performances• Prada Linea Rossa SS23 campaign
proposed an unreal landscapephotographed and then reimaginedby Norbert Schoerner, clashing
together cityscape with landscape in
impossible combinations

6• Prada Caffè opened at Harrods,
London, to offer a unique experiencein an environment that revisits
Prada’s visual hallmarks• Prada presented 9th iteration of Prada
Mode in Tokyo, in association with
the Tokyo Metropolitan Government
and the Teien Art Museum

July 27th 2023

Miu Miu’s increasing visibility
Outstanding performance reflected in the web search growth

Sustained brandbuilding investments• Miu Miu FW23 show “Ways of
Looking” held in Paris further
increased brand momentum andvisibility, featuring an installation by
South Korean artist Geumhyung
Jeong• #25 Miu Miu Women’s Tales in
London, presenting “Eye Two Times
Mouth” written and directed by Lila
AvilésExceptional personalities
drive campaigns allurement• Celebrated the emblematic matelasséin the newly-debuted Arcadie bag,photographed by Steven Meisel
capturing Gigi Hadid• SS23 campaign photographed by
Zoë Ghertner featured crossdisciplinary talents including Kendall
Jenner, Ever Anderson, Emma Corrin
and Karolin Wolter

Brand exclusive collaborations
and special capsules

New and consolidated formats
elevate the brand experience• Excellent reception of the “NewBalance for Miu Miu” sneakers
second drop that reinvents theiconic 80s style in fringed denim
and nappa leather• Miu Miu Select in Taipei featuring
ambassador Lee You-Mi to
showcase her favourite Miu Miu
selection• Remarkable response to thelaunch of Miu Miu L’Été collection• Successful 360° launch of theArcadie bag, with omnichannel
activations worldwide• A growing and bold network of‘friends of the house’ worldwide

7

July 27th 2023

ESG focus on key areas of supply chain and water challenges
Driving continued progress against environmental commitment
Building a Responsible Supply Chain

Widening of Water Conservation Framework

Launched ambitious Water Conservation Programme
to monitor water availability, usage and quality in our
supply chains across key geographies to identify risks
and best practices for future remediation actions

Transparency
First disclosure of the Group’s industrial suppliers
Traceability
Upcoming project to trace leather in our supply chain
engaging the Group’s main tanneries and powered bytechnical partnerships

Water footprint assessment in H2 (baseline definition)
Citizen’s Science Academic Project to involve
Group’s employees in freshwater monitoring andprotection

Decarbonisation
Engagement of selected suppliers to improve theirresources efficiency with global partner

Announced new enhanced partnership with IOCUNESCO for SEA BEYOND to create an open platformand expand training on ocean preservation.
Prada Group to donate 1% of Prada Re-Nylon
collection revenues

Chemicals management
Signed strategic partnership with ZDHC

8July 27th 2023

AgendaPatrizio Bertelli - Chairman and Executive Director
Highlights
Lorenzo Bertelli - Marketing Director and Head of CSR
Key Marketing Initiatives and ESG Update
Andrea Guerra - Group CEO
Business Update
Andrea Bonini - Group CFO
H1-23 Financial Review
Andrea Guerra - Group CEO
Closing Remarks
Q&A Session

9

July 27th 2023

PradaPositive semester, continuing to capitalise on strong identity,
creativity and uniquely polyhedric brand equity
Strategic decision to increase marketing and communication
investments to foster brand desirability and visibility
Methodical introduction of newness, wisely balanced with thestrengthening of Prada iconic products• Highly visible and successful “The Glass Age” campaign,celebrating the Galleria bag; accelerating sales performanceand positive halo effect on the category• Ongoing success of men and women RTW and Footwear
collections• Strengthened role of Re-Nylon as a distinctive asset of the
Prada product portfolio, connecting design and sustainability
Constant focus on retail KPIs to increase effectiveness andproductivity in the journey to retail excellence• Investment on right-staffing of key stores to sustain andaccelerate growth• Restless effort on clienteling and client engagement
Evolution and upgrade of the Retail network progressing at pace

10

July 27th 2023

Miu Miu

Excellent brand momentum globally, underpinned by a clearer andstronger identity, growing awareness and desirability
Accelerated investment continued to amplify brand visibility andrelevance to growing client baseReinforcement of brand codes and constant flow of collections reflecting
needs of the present time, fuelling brand desirability across all categories• Continued success of the iconic Matelassé, driven by the new Arcadie
and the Wander bags
• Strong commercial response to the New Balance for Miu Miu sneakers
second drop
• Sustained positive results of RTW, with remarkable reception of the
Miu Miu L’Été collection
Ongoing store renovations and focus on key retail initiatives along thecustomer journey contributed to like-for-like growth, with increasing store
productivity
Vast opportunity to continue growing brand awareness and for greater
retail effectiveness

11

July 27th 2023

AgendaPatrizio Bertelli - Chairman and Executive Director
Highlights
Lorenzo Bertelli - Marketing Director and Head of CSR
Key Marketing Initiatives and ESG Update
Andrea Guerra - Group CEO
Business Update
Andrea Bonini - Group CFO
H1-23 Financial Review
Andrea Guerra - Group CEO
Closing Remarks
Q&A Session

12

July 27th 2023

Key Financials
Solid growth and improved profitability
H1-23 Net Revenues€2,232 mln (+17% vs. H1-22 / +20% at constant fx)

H1-23 EBIT
€491 mln

H1-23 Cash Flow from Operations (3)€509 mln

Retail Revenues (€ mln) and Growth (%) (1)

EBIT (2) (€ mln) and Margin (%)

Net Financial Position (€ mln) (4)

+54%
11.1%

17.4%

22.0%

+21%

1,975
1,678
283
1,281

179

491
331
166
-102

H1-21

H1-22

H1-23

H1-21

H1-22

H1-23

H1-21

H1-22

H1-23

(1) At constant fx (%) (2) EBIT Adjusted for H1-22 (3) Cash flow from operating activities, less repayment of lease liabilities (4) (Net debt) / Net cash position

13

July 27th 2023

Net Revenues by Channel
High-quality Retail growth driven by like-for-like, full price sales€ mln% at constant fx

H1-23

H1-23
vs.
H1-22

Q2-23
vs.
Q2-22

Retail

1,975

+21%

+19%

Wholesale

210

+9%

+8%

Royalties

47

+66%

+80%

Total

2,232

+20%

+19%

Wholesale9%

Royalties2%

Retail89%•

Retail- Solid growth driven by like-for-like, full price sales- Positive contribution from both average price and full price volumes•

Wholesale- Sustained growth in duty-free channel, partially offset by ongoing selective approach to independent clients•

Strong Royalty growth continues supported by both eyewear and fragrances•

Negative FX impact of 310 bps on performance at current exchange rates

14

July 27th 2023

Retail Sales by Brand
Solid growth at Prada; further acceleration at Miu Miu€ mln% at constant fx

H1-23

H1-23
vs.
H1-22

Q2-23
vs.
Q2-22

Prada

1,668

+18%

+15%

Miu Miu

285

+50%

+57%

Church’s

13

-21%

-20%

Other (1)

9

+14%

+6%

Total

1,975

+21%

+19%

Church's Other
0%1%
Miu Miu
14%

Prada
85%

•

Prada
• Solid and high-quality Retail like-for-like growth; more moderate in Q2 against high comps globally excluding China• Double-digit growth across all regions excluding Americas• Broad based growth across customer demographics and product categories•

Miu Miu• Further acceleration vs. Q1, supported by higher exposure to China and Asia
• Sustained double-digit growth across all regions• Strength across all categories(1) Includes Marchesi and Car Shoe

15

July 27th 2023

Retail Sales by Geography
Strong double-digit growth across all regions excl. Americas€ mln% at constant fx

H1-23

H1-23
vs.
H1-22

Q2-23
vs.
Q2-22

Asia Pacific

716

+25%

+28%

Europe

582

+24%

+22%

Americas

361

-1%

-6%

Japan

224

+49%

+44%

Middle East

92

+14%

+12%

1,975

+21%

+19%

Total

MiddleEast 5%

Japan
11%
APAC
36%

Americas18%

Europe29%• Asia Pacific rebound continued- Q2 acceleration in mainland China, HK and Macau, supported by easier base of comparison due to heavy
restrictions in April and May 2022, lifted in June
- Korea softer, also impacted by Cheongdam Seoul store temporary closure; South East Asia normalised againstvery tough comps (lifted restrictions in April 2022)• Elevated double-digit growth in Europe despite very challenging comps• Americas ended the semester substantially flat; North American client cluster continued to grow throughout thesemester, including in Q2, notwithstanding prolonged period of sustained growth• Japan best performing region, benefitting from recent investments in retail network and strengthened organisation,
successfully capitalising on strong brand appeal, solid domestic demand and increasing tourism flows
16

July 27th 2023

Retail Sales by ProductContinued double-digit growth across all categories€ mln% at constant fx

H1-23

H1-23
vs.
H1-22

Q2-23
vs.
Q2-22

Leather Goods

925

+12%

+10%

Ready to Wear

609

+36%

+34%

Footwear

374

+20%

+20%

Other

66

+50%

+43%

Total

1,975

+21%

+19%

Other
3%

Footwear19%
Leather Goods
47%

RTW
31%

•

Leather Goods• Prada benefitting from successfull Galleria bag campaign “The Glass Age”, positive halo effect on the category• Miu Miu growth driven by success of Wander, Pocket and recently launched Arcadie•

RTW• Fastest growing category thanks to continued success of both Prada and Miu Miu collections•

Footwear• Continued growth of all collections (lifestyle, sneakers, formal)

17

July 27th 2023

Gross Margin
260 bps increase driven by average price, channel, scale

79.8%
H2-22

2.6%

80.3%

Avg. Price
Channel Mix
Scale
Logistics
Raw Materials and Others
FX / Hedging

H1-23

77.7%

H1-22

Note:

Positive impact

Negative impact

18

July 27th 2023

EBIT and Net Income
EBIT Margin of 22% and Net Income growth of 62%
€ mln

H1-22

% on Net
Revenues

H1-23% on Net
Revenues

H1-23
vs. H1-22

Selling

796

41.8%

895

40.1%

+12%

Advertising & Promotion

155

8.2%

187

8.4%

+21%

Design and Product Dev.

69

3.6%

72

3.2%

+6%

G&A

127

6.7%

148

6.6%

+16%

Total Operating costs (1)

1,147

60.3%

1,302

58.3%

+14%

EBIT

331

17.4%

491

22.0%

+49%

Net Income

188

9.9%

305

13.7%

+62%

•

OPEX increased by +14% reported, 15% at constant fx mainly driven by marketing and communication
investments, variable component and labour cost•

EBIT of €491 mln, up by 49% vs. EBIT Adjusted of H1-22(2), 460 basis points yoy improvement to 22.0%•

Net Income of €305 mln, up by 62%(1) Excludes other non-recurring income and expenses for H1-22(2) +61% vs. EBIT of H1-22

19

July 27th 2023

CapexAcceleration of Retail, IT and Industrial investments
151
€ mln
Corporate, IT & Industrial

56

Retail
97

35

95
62

H1 -2 2H1 -2 3•~ 70 renovation and relocation projects in H1-23•

9 net closures vs. FY-22 (14 openings and 23 closures) / 603 DOS end of June 2023•

€22 mln Industrial Capex and €27 mln IT Capex

20

July 27th 2023

Net Operating Working Capital
Good control of inventory with limited increase

€ mln

691

723

332

325

760

785

-402

-387

FY-2 2H1 -2 317%

16%

Trade Receivables
Inventory
Trade Payables% of Net Sales (1)(1) Net Revenues excluding Royalties

21

July 27th 2023

Net Financial Position

Solid balance sheet with Net Cash of €283 mln€ mln

Opening Net Financial Position Surplus / (Deficit) - 31/12/2022

535

Consolidated Profit / (Loss) before taxation

445

Depreciation and Amortisation

111

Net Working Capital-66

Tax paid-305

Capital Expenditures and Investments-149

Dividends

-267

Other

-21

Closing Net Financial Position Surplus / (Deficit) - 30/6/2023

283•

Strong Cash flow from Operations(1) of €509 mln (€321 mln in H1-22)(1) Cash flow from operating activities, less repayment of lease liabilities

22

July 27th 2023

AgendaPatrizio Bertelli - Chairman and Executive Director
Highlights
Lorenzo Bertelli - Marketing Director and Head of CSR
Key Marketing Initiatives and ESG Update
Andrea Guerra - Group CEO
Business Update
Andrea Bonini - Group CFO
H1-23 Financial Review
Andrea Guerra - Group CEO
Closing Remarks
Q&A Session

23

July 27th 2023

Closing Remarks
Another positive semester with significant and well balanced growth
Focused effort to progress fundamental Group projects of strategic,organisational and digital evolution
Continued to strengthen desirability of our brands and their roots in therespective cultural heritage
In store, we started the journey of moving our front line colleagues
to be real brand and sales ambassadors
Second half 2022 had very fast Q3, with a great summer period in Europe, and amore moderate Q4, with another Covid-impacted period in scattered parts of Asia
Investments behind the brands and on the stores will continue to accelerate, asconditions allow; we will remain nimble to react to potential macroeconomicchanges
We are well equipped for another successful semester
We retain our ambition to deliver solid, sustainable and above-market growth in
2023
Coming up soon, another big milestone for the Prada brand, in the beauty
category...

24

July 27th 2023

AgendaPatrizio Bertelli - Chairman and Executive Director
Highlights
Lorenzo Bertelli - Marketing Director and Head of CSR
Key Marketing Initiatives and ESG Update
Andrea Guerra - Group CEO
Business Update
Andrea Bonini - Group CFO
H1-23 Financial Review
Andrea Guerra - Group CEO
Closing Remarks
Q&A Session

25

July 27th 2023

APPENDIX

26

July 27th 2023

Condensed P&L
€m

H1-21

H1 22

H1 23

Net Revenues

1,501

100%

1,901

100%

2,232

100%

COGS

-386

-25.7%-423-22.3%-439-19.7%

Gross Profit

1,115

74.3%

1,477

77.7%

1,793

80.3%

Selling-651-43.4%-796-41.8%-895-40.1%

Advertising & Promotion

-127

-8.5%

-155

-8.2%

-187

-8.4%

Design and Product Development

-64

-4.2%

-69

-3.6%

-72

-3.2%

G&A

-107

-7.1%

-127

-6.7%

-148

-6.6%

Operating expenses-949-63.2%-1,147-60.3%-1,302-58.3%EBIT Adj.

166

11.1%

331

17.4%

491

22.0%

Non-recurring items

0

0.0%

-26

-1.4%

0

0.0%

EBIT

166

11.1%

305

16.0%

491

22.0%

Total Financial expenses

-28

-1.8%

-27

-1.4%

-46

-2.1%

EBT

138

9.2%

277

14.6%

445

19.9%

Income Taxes

-41

-2.8%

-88

-4.6%

-138

-6.2%

Minority Income

0

0.0%

1

0.1%

1

0.1%

Group Net income / (Loss)

97

6.4%

188

9.9%

305

13.7%

Total D&A (1)-312-20.8%

-352

18.5%

-336

15.1%

(1) Total D&A include depreciation of Right of Use

27

July 27th 2023

Condensed Balance Sheet€ mln

31 Dec 2022

30 June 2023

Right of use

2,011

2,082

Non current assets (excl deferred tax assets)

2,517

2,545

Net operating working capital

691

723

Other current assets / (liabilities), net

-293

-94

Other non current assets / (liabilities), net

148

172

Net invested capital

5,074

5,428

Consolidated shareholders’ equity

3,501

3,521

Net financial position (surplus) / deficit

-535

-283

Long term lease liability

1,715

1,769

Short term lease liability

392

420

Total

5,074

5,428

28

July 27th 2023