LONDON – Manolo Blahnik saw sales and profits decline in fiscal 2023 due to a drop-off in demand for luxury goods, although the company remains upbeat and is planning to open stores in new markets including Shanghai, Miami and Milan.
The London-based footwear and accessories brand saw sales fall 10 percent to 106.5 million euros, and pre-tax profits tumble 30 percent to 15.4 euros in the 12 months to Dec. 31, 2023.
The company, which is privately owned, said that despite slowing demand for luxury, performance was in line with expectations.
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Operating profit remained “strong” at 15 percent of revenue, and the company said it made significant investments in infrastructure and supply chain during the period.
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The results will be published in the coming days on Companies House, the register of businesses in the U.K.
Manolo Blahnik said it is expecting a “return of customer confidence in 2025,” which will coincide with its expansion plans into new markets in China, North America and Europe.
“As expected, in 2023 our performance rebalanced off the back of an extraordinary year of sales and consumer demand in 2022, and in light of the challenging macro-economic and geopolitical environment. Against this backdrop we are pleased to still be reporting a positive performance in our second-best year ever, in line with our business plan,” said Kristina Blahnik, chief executive officer.
She believes there will be “a continued readjustment to pre-COVID demand” in 2024, and said the company has been using the period of transition to restructure.
Manolo Blahnik has been refining its direct-to-consumer and business-to-business models as it puts a larger focus on retail and own channels, and consolidates its wholesale network.
Blahnik added that the behind-the-scenes work would put the business in a strong position to grow once consumer confidence rebounds.
The coming months will big ones for the brand.
Later this year Manolo Blahnik will mark a milestone and begin trading in China, with plans to open its first store in Shanghai.
The company has recently established a wholly foreign-owned enterprise (WFOE) in China, where it recently secured the rights to use its brand name after more than two decades of legal wrangling.
In 2022, after a 22-year legal battle, the Supreme People’s Court of China, the highest court in the country, ordered the invalidation of an unlawful Manolo Blahnik trademark that had been registered by a local businessman in 2000.
The company is also making moves in Hong Kong. Earlier this year, Manolo Blahnik formed a joint venture with Bluebell Group to open a string of stores in the region.
The first boutique opened in Hong Kong’s Lee Gardens shopping center on March 22, while a second one is set for Pacific Place shopping center in the final quarter of 2024. A third store is also in the works, with the location to be confirmed.
Manolo Blahnik and Bluebell have existing partnerships in other Asian markets such as Japan, Malaysia, Singapore and Taiwan.
While Asia may be top of the agenda, the company also has plans to expand in other markets. In early 2025 it will open flagships in Miami Design District and Milan, two cities where it does not currently have direct retail.
As reported, the company has also been making changes closer to home.
Last September Manolo Blahnik relocated its U.K. global headquarters from Marylebone to a historic Georgian building in London’s Mayfair with more than 14,500 gross square feet of office, showroom and meeting spaces.
The group has also overhauled its e-commerce site and improved conversion metrics. Last September, it enriched its digital archives with a new, virtual space meant to highlight artistry and artisans.
The space is called “The Manolo Blahnik Archives, The Craft,” and features eight vignettes that spotlight the craft process from design to technique to construction. Hundreds of pieces of digital content are meant to offer “unparalleled” insight into the art of shoemaking.
The brand has also committed to donating 0.5 percent of its turnover to the Manolo Blahnik Foundation, which was formed in 2022. The foundation supports causes including mental health and well-being, animal welfare and new generations of talent.