Ermenegildo Zegna NV's stock soared 7.08% in intraday trading on Friday, following the release of its full-year 2025 financial results that showed improved profitability and an earnings per share beat.
The luxury fashion group reported a profit of EUR 109.5 million for fiscal year 2025, representing a 20% increase compared to the previous year. Earnings per share came in at EUR 0.38, exceeding the FactSet consensus estimate of EUR 0.35. While revenues declined 1.5% to EUR 1.92 billion, the company demonstrated significant margin improvement with gross profit margin rising to 67.5% from 66.6% in FY 2024.
Key drivers of the improved financial performance included a favorable channel mix shift, with direct-to-consumer sales rising to 82% of total branded products revenue. The company also generated strong free cash flow of EUR 82.1 million, more than eight times the previous year's level, and moved to a net cash surplus position of EUR 52.1 million from net financial indebtedness. Management proposed a dividend of EUR 0.12 per ordinary share.
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