Prada's Profits Continue To Slide

Italian luxury goods company Prada reported reported a steep fall in its first-quarter profit . In the three months to April 30, Net income fell 44% to $66.2 million with Asia Pacific region, especially Hong Kong and Macao, not showing any sign of improvement in the first months of 2015, the company said in a statement.

"Performance in this area has been affected mainly by the market conditions in Greater China, especially in Hong Kong and Macau, where the decline in Chinese tourist numbers, already seen in the second half of 2014, shows no signs of abating," Prada said in a statement.

The Asia Pacific region posted the weakest performance, with net sales down 17% at constant exchange rates, while Europe benefited from an increase in tourist flows.

In light of its recent slide Prada said it is taking measures to counter the negative effects on margins of the lack of retail sales growth, and aims to start again a growth trend as well as to rationalize operational processes to increase efficiency, so as to achieve a return at the levels of profitability enjoyed until the recent past. The company which has scaled back its retail expansion plan in response to tough trading conditions, said it would further cut its goal for net shop openings this year to 24-26 from 30 in a bid to shield margins.