Ray-Ban maker EssilorLuxottica on Wednesday confirmed its forecasts through 2026 but also said it was implementing measures including US price increases to manage the impact of import duties in that country.
The company, which makes lenses and sunglasses in Thailand and China and exports premium frames from Europe, is exposed to potential tariffs of up to 36 per cent on Thailand-made products and 145 per cent on those from China, and up to 20 per cent on imports from Europe.
“Clearly we’re not immune to tariffs; we make about 43 per cent of our revenue base in the US”, chairman and CEO Francesco Milleri told analysts in a post-earnings call.
“We’re moving toward the price adjustment in the single-digit territory in the US across the different product lines and across our distribution channels”, Milleri said.
He added that the company would continue diversifying its supply chain.
While most of Trump’s tariffs have been paused for 90 days until July 8, those on Chinese imports and a 10 per cent universal rate remain in place.
The Franco-Italian group reaffirmed its target of mid-single-digit percentage growth in annual revenue between 2022 and 2026 at constant exchange rates, with a goal of US$30.6-31.7 billion by the end of the period.
It also confirmed it expects adjusted operating profit equal to 19 per cent to 20 per cent of revenues by 2026, compared to 17 per cent at the end of last year.
In the first quarter, EssilorLuxottica posted a 7.3 per cent increase at constant rates in its revenues, to US$7.78 billion, helped by gains in Europe and the strong performance of its Ray-Ban Meta smart glasses, it said.
Quarterly sales in the Asia-Pacific region, the group’s fastest growing market, grew by a yearly 10.4 per cent at constant rates, helped by rising demand for its myopia management solutions, a growing offering which Jefferies analysts expect to achieve 25-35 per cent annual growth in the foreseeable future.
“EL has largely delivered against a high consensus bar in our view, with robust revenue growth in a tough consumer marketplace,” RBC said in a note.
- Reporting by Hugo Lhomedet and Alessandro Parodi in Gdansk; Editing by David Goodman and David Gregorio, of Reuters.
