LensCrafters 2007 Annual Report Download - page 26

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2007 was another record year for Luxottica, the fourth year running in which Group sales saw
double-digit growth at constant exchange rates. We hit our Euro 5 billion sales target, achieving a
12.5% growth in sales at constant rates, which was close to our exceptional performance in 2006,
when sales were up 14.0% over the previous year.
Even without taking Oakley into account, the wholesale division saw 20.2% growth in sales at
constant rates in 2007, with sales of around Euro 2 billion, reflecting the excellent work done on the
brand portfolio in the last few years. Sales to third party clients (a particularly good indicator of
business performance) grew 21.7% at constant rates. Ray-Ban’s total sales grew by double digits
for the fifth consecutive year and excellent results were likewise recorded by the luxury brands,
including Bvlgari, Chanel, Dolce & Gabbana, Prada and Versace. Geographically, Luxottica
continued to strengthen its presence worldwide. Revenues from the wholesale business in
emerging markets were up 41.6%, making this market a priority for expansion.
Retail results, again excluding Oakley’s contribution, were satisfactory, with growth of 5.6% in sales
at constant rates and an increase in sales of 1.1% (on comparable stores, exchange rates and
consolidation area basis) despite the ups and downs of a North American market reacting to fears
of recession. In all its other markets, Luxottica recorded excellent results, especially in its retail
business in Australia and China. Sunglass Hut continued to grow in all its markets: over the last
three years it has posted growth of 40% on comparable stores, exchange rates and consolidation
area basis.
The overall business performance in North America, excluding Oakley, was positive throughout the
year, with total sales (wholesale and retail) up 6.1% (in US$) on the previous year.
In 2007, Luxottica Group acquired Oakley for US$ 2.1 billion. The acquisition provides an
incredible opportunity for the Group.
The agreement will integrate two strong and complementary business models. It will strengthen the
Group’s portfolio of house and license brands and provide Oakley with a global distribution
platform for its products. Oakley is a strong and innovative brand, a world leader in sport,
technology and lifestyle, and has great growth potential in various market segments.
A new Group with extraordinary potential has thus come into being: aggregate pro forma net sales
for 2007 was approximately Euro 5.5 billion, and pro forma EBITDA was approximately Euro 1.2
billion. Luxottica Group expects the Oakley acquisition to yield synergies worth approximately Euro
100 million over the next three years deriving from increased sales and enhanced operating
efficiency.
LUXOTTICA
GROUP
IN 2007