Zegna swings back to profit as namesake brand and Thom Browne impress


Ermenegildo Zegna Group’s 2022 results on Thursday looked impressive with the company saying it had a “robust” year and its results were in line with its strategic plan.

Profit was €65.3 million — a dramatic swing from a loss of €127.6 million the year before — and adjusted EBIT was €157.7 million (up from €149,1 million), despite a Covid-linked impact in the Greater China Region during Q2 and Q4.

That came as revenues rose to €1.49 billion from €1.29 billion. Zegna brand revenues rose to €1.17 billion from €1.03 billion and Thom Browne was up to €330 million from €264 million.

The company said that while revenues rose a healthy 15.5%, excluding the Greater China Region, 2022 revenues were up as much as 42% year-on-year.

And Chairman/CEO Ermenegildo ‘Gildo’ Zegna, said: “Our robust performance in 2022 reflects the strong momentum and desirability of our brands as well as the soundness and success of our strategy and execution.”

“Last year, we embarked on a journey of rebranding our namesake label, as we unveiled the Zegna One Brand. We are still at the beginning of this journey, having just launched the second season and a number of new initiatives.” 

The company said that this label, which officially launched in July 2022, “is proving successful, with increased demand for the brand’s iconic products – especially luxury leisurewear and footwear – and a solid rebound in the brand’s formalwear business”. 

At the same time, Thom Browne continued its solid expansion, adding 11 (net) directly operated stores and strengthening the client value management program. It has done particularly well in Greater China.

The CEO also explained that “2023 is off to an encouraging start, with solid double-digit performance in the group’s retail network” and he’s “optimistic that the reopening of the Greater China Region, together with the positive response to our collections we are seeing from our customers worldwide, will continue to drive the growth of our global business”.

That said, he acknowledged that “current financial uncertainties and an ever-changing global environment have the potential to affect consumer attitudes and buying patterns”.

But the company still expects double-digit revenue growth for Q1 with 2023 revenue looking likely to come in at around €2 billion with a 15% adjusted EBIT Margin by 2025, excludingTom Ford Fashion.

Of course, Tom Ford will have a big impact this year and beyond after the company acquired the long-term license for the label as part of the Estée Lauder purchase of the brand. 

The transaction hasn’t yet closed (that should happen in Q2) and Zegna has promised more details about its plans for the label when that deal completes.

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