Intervista al Dott. Miroglio su CLASS CNBC TV

Well, first of all, we have a consolidated presence in China already for some years. We began an initial expansion in 2004 with a joint venture that has been very successful over the years. We acquired 50% of a local Chinese retailer in 2004, and over these seven years we have experienced truly exponential growth. This gave us the courage to strengthen our Chinese presence by opening direct stores with our brand Motivi, which today has 45 stores in China. But above all, it gave us the conviction that we can truly play a leading role in the Chinese market. Hence the desire to play bigger, to create a partnership with the Mandarin fund to build a real multi-brand group, a set of brands that can combine our own brands and companies to acquire, to create a truly integrated company of great importance in the Chinese market. Undoubtedly, we know that the Chinese market is probably the most competitive market in the coming years because it attracts European, American, and local Chinese and Asian competition. But it is undoubtedly a market that today offers the most interesting growth rates, and I believe it is necessary to have a strategy for China, an aggressive strategy for China. Two years ago, a shareholder restructuring redefined the balance within the company. After two years, can a first assessment be made? Undoubtedly, the first benefit has been greater clarity in the ownership structure. I think that is fundamental to give the company, the employees, and everyone working in the company security about the present and the future. That has also given us who have in some way taken up the baton for the future the conviction that we truly have all the levers in hand to make an impact. So I must say that starting from the end of 2009, when this corporate change began, for us a new chapter began, a turning point began. We started working on a new company.

Well, today management is certainly a predominant presence, and it will be even more so in the future. Our group wants to make family tradition a very strong baggage of experience and knowledge, and we want to consider it, as it has always been, a great added value. But for it to become added value and not a brake on growth, we believe it is important to see the family business as a modern family business, not a patriarchal one but one that can combine a family vision, therefore more medium to long-term, with a presence of managerial talents that are indispensable for tackling all the great challenges the world offers today. For four years now, the company has been open to independent directors; the chairman is a long-time manager like Carlo Cageri. These are signals of the intention to open up the capital to third-party shareholders in the future, for example through a stock exchange listing if the stock market stabilizes, but at the moment it is not in our plans to go public. This is because our group fortunately does not have financial needs to raise capital; we have a very strong net financial position. So certainly the financial aspect does not concern us. We could consider making agreements, as we did with Mandarin, if we find partners that can bring industrial and business synergies to help us achieve our goal of international growth. So listing is not in sight at the moment, but certainly greater flexibility at the shareholder level compared to the past is in our DNA.

Well, actually we are not very small, but we are still small because beyond the overall global size of the group, which is quite important at around one billion euros, this billion is made up of a plurality of many small and medium-sized businesses. So the challenge of becoming big is still ahead of us, but we feel we can take it on and win.

The industrial part was our soul until a few years ago, our roots. The company was born and grew as an industrial company both in textiles and clothing. Ten years ago a transformation began, I would call it somewhat unconscious but definitely important. The company that ten years ago was 90% industrial today is 70% commercial, a company focused on retail. Despite this, we still consider the industrial part an important value for our company because we believe that to ensure a distribution chain a product with quality and price suitable for the market, it is necessary to know the craft behind it, therefore to know all the industrial levers.

Certainly intellectual property is a hot topic, especially in markets where the concept of intellectual property is not as pervasive as in Italy or Europe. At the moment we don't have very significant problems from this point of view, but certainly research on the electronic tag can allow us to prevent potential problems. However, for us the electronic tag also has an important efficiency factor, as it can allow that traceability of the garment which, especially before putting the garment on sale, can give us great advantages from a logistical and product handling point of view.

The creativity of our brands, I would call it a diffuse creativity. For each of our brands (we currently have 10 brands in our portfolio), each brand has its own team of creatives, stylists, designers who collaborate with external style studios and external creatives. It is precisely from this combination of internal and external that the creativity of all our collections is born. Furthermore, considering creativity today as one of the absolutely scarce elements in the market, about ten years ago we decided to promote an internal school of creativity that is giving us good results and in recent years has allowed us to bring into the company about a hundred new young creatives who represent the future of our company.

No, at the moment the only partner we have is that with Crizia. We are one of the, I believe the only company that has realized a plus-size license, so comfortable sizes with an important brand like Crizia. It is a license that gives us excellent results, but at the moment we do not plan to expand it.

Yes, the first semester. I should first say that it was not a particularly brilliant semester. We had a turnover of around 450 million euros, which was in line with 2010. However, the increase in raw material costs, which in our sector was quite significant; in some cases on some fibers we even saw a 50% increase, and the increase in labor costs in various global sourcing markets led to a general increase in product costs. Combined with an orientation from the final consumer towards products at more affordable prices, this led to a fairly significant margin compression that was felt. Despite this, I would say that prudent management, especially from a cash perspective, which I believe is absolutely important at this time, allowed us to have a net financial position of almost 260 million euros, which is actually up from the previous year.

Yes, we have a scouting and M&A process in collaboration with Mandarin already underway for a few months. We have already identified four or five potential targets. They are retail brands that operate in the Chinese fashion retail sector. Our goal is to close a deal by the first quarter of 2012.

In Russia we actually already have a fairly important operational base. We currently have about sixty stores with our brands, particularly Motivi, which is the most present brand on the Russian market. But we have recently decided to change our organization for strategic markets and international markets, starting with Russia. In fact, from September 1st of this year we created a permanent structure for the development of the Russian market, creating a position of Managing Director for Russia, promoting an internal resource that we wanted to grow in this career path. This figure will effectively become responsible for the strategy and execution of the strategy on the Russian market. So there will no longer be what we consider a weakness, that is, conducting a complex business like an emerging market like Russia and China from Alba, Italy, but rather delegating and delocalizing some important decision-making levers, including product adaptation, collection adaptation, marketing strategy adaptation to the local market. We believe it is truly important to know the market and adapt to local markets.

Well, we feel the roots are strongly Piedmontese, strongly from Alba. All our family lives in Alba, so we have a very strong presence and a very important bond with the territory. We love our territory, but we realize that it is increasingly important to think globally, so to overcome the boundaries not only of Alba but of Italy, because to be a global player, you truly need to have a global mindset. And we are doing this thanks to the opening to managers who come from outside, who come from experiences not only outside our company but outside of Italy, who can enrich us and in some way integrate the knowledge and great experiences that we have as Piedmontese.