This excerpt taken from the LUX 6-K filed Feb 8, 2008.
Key figures: Luxottica Group expects to exceed 6.1 billion in consolidated sales for fiscal year 2009, assuming an average exchange rate of 1 = US$1.45, reflecting an increase of 27% at constant exchange rates from fiscal year 2007. Consolidated sales for fiscal year 2008 are expected to be between 5.6 billion and 5.75 billion. EPS in excess of 1.31 are expected for 2009 (up by 35% from 2007, excluding the impact of exchange rates and trademark amortization). EPS for 2008 are expected to be between 1.11 and 1.14. The Group now expects that it will report fiscal year 2007 EPS of 1.08, reflecting an increase of 24% from fiscal year 2006 at constant exchange rates.
The Group estimates that operating synergies between the two companies will deliver yearly benefits worth 100 million by 2010, broken down as follows: 20 million in 2008, 60 million in 2009 and 100 million in 2010.
The combination of Luxottica and Oakley changes the future of our industry, said Andrea Guerra, Luxottica Group CEO, on presenting the plan. Today is the start of a new Luxottica Group, of three to five years of development, new projects and the exploration of new segments. Two complementary models, two histories that are unique but with much in common: Oakleys extraordinary sun lens technology and its supremacy in sport together with our scale, links with the luxury and fashion worlds as well as design and manufacturing excellence. The combination of these strengths will enable us to create a competitive edge on a global scale, at all levels of the organization and with unlimited growth potential.
Our common work already began last summer. Since then, the top 80 Oakley and Luxottica managers have been working together on plans for the future and we are now in the execution phase. This process has been based from the outset on a real integration of people and cultures of our two companies before that of the businesses. This is the only way we can fully realize the extraordinary opportunity we have in front of us to change the development of our industry.
Today we are witnessing the creation of new market segments and lifestyles as barriers between technology, luxury and sport come down. There are now three businesses that we have in-house and with which we can consider and guide change while maintaining firm leadership in each segment.
Our growth forecasts reflect the potential of the new Luxottica Group, for the entire period of the plan.
Europe and emerging markets are the first priorities of our plan. Throughout the integration, the entire Luxottica sales and operating infrastructure is at the disposal of Oakley, one of the most desired brands in those countries, to more than double Oakleys sales over the next three years. The retail market, in addition to clear operating synergies coming from the combination of the Luxottica and Oakley store base, will give us the opportunity to tell the story of the Oakley brand in many more new stores, with a particular emphasis on the optical segment.
Among priorities, the plan includes important changes in the industrial and operating space, to immediately leverage all possible operational efficiencies coming from each others strengths. The Research & Development area in sun lenses will be an area of important focus, merging Oakleys skills with Luxotticas long tradition. Finally, the Groups new optimal logistics structure will be identified soon.
Thinking about this operation as a business development and not as a simple integration, the plan also includes other projects which further widen the Groups potential. These projects are: to strengthen retail coverage of the luxury segment in North America; to appropriately position brands such as REVO and Arnette; to encourage the development of our traditional sports brands and strengthening global operating infrastructure for Oliver Peoples, a luxury Californian brand desired globally.
We have merged the strengths of two winning companies, concluded Mr. Guerra. Business planning has concluded and has already entered its execution phase. Now, with our characteristics of speed, entrepreneurship, simplicity and passion, we have to continue striving to meet current and future needs of our customers from a global perspective.