The board of directors of Italian eyewear giant Luxottica was set to approve the preliminary results for 2018 in its January 30 meeting. Instead, in one of the board’s last sessions (it will bow out on March 6, after approving the 2018 financial statement), it chose to summarise the results of the last four years, celebrating the stellar performance of the group, led by “visionary” founder Leonardo del Vecchio, which is now part of the EssilorLuxottica leviathan.

To understand how far Luxottica has come, it is worth remembering that, when it was first listed on Wall Street in 1990, its share price was less than one US dollar. When Luxottica will delist from the Milan stock exchange on March 6, it will do so at a share price of over €50, “having multiplied its worth by over 50 times in nearly 30 years,” wrote the board in a press release comparing the results of the 2015-2018 period with those of 2010-2013.

In the last four-year period, aggregate sales grew 40%, reaching €36 billion, adjusted operating income grew 60% to €5.7 billion, adjusted net income grew 80% to over €3.6 billion, and adjusted net margin increased from 7.5% to over 10%. Luxottica’s substantial cash flow enabled the group to slash debt from twice the value of EBITDA in 2010 to 0.2-0.3 times EBITDA in 2018, ensuring it paid out generous dividends too (€1.8 billion between 2015 and 2018,  up 80% over 2010-2013).

Ads

For 2018, the group forecast a revenue of around €9 billion and a net income of over €900 million, slightly down from the record €970 million in 2017.

“I achieved the objective I set myself, of improving the company in all its parts, making it strong and brimming with ideas, technology and passion, and at the same time enabling it to raise net margin above the 10% threshold. This is the company we are endowing EssilorLuxottica with, for a new adventure to which I intend to contribute to the full,” said Del Vecchio, executive president of the newly formed EssilorLuxottica conglomerate.

Del Vecchio mentioned Luigi Francavilla, alongside him “for his entire working life,” and also gave “special thanks” to the CEO of Luxottica, Francesco Milleri, whom Del Vecchio already said he wants to see in charge of EssilorLuxottica. The latter appointment will have to be jointly decided with Luxottica’s French partners, through a process that will lead to the joint appointment of a new CEO by 2020.