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Prada's net income in the three months through April tumbled to $64 million compared to $144.2 million in first quarter 2014, Bloomberg reports. It's a result that fell short of analysts’ estimates. Sales are slumping in China and the luxury brand is responding by opening fewer stores, getting rid of some wholesale accounts, and introducing a wider selection of bags in the more attainable price range of approximately $1,100 to $1,300.
Unrest in the brand's key Asia Pacific market has continued to be a huge problem for Prada. "In the first few months of 2015, Asia Pacific markets, especially Hong Kong and Macao, have not shown any clear signs of recovery compared to the final months of 2014," Prada said. "This ongoing situation continues to significantly affect the group's operating results."
The plan going forward, Prada said, is that the company "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."