Bulgari Ireland sparkles with €1.1bn sales

Bulgari, the Italian jewellery brand whose creations were famously sought after by the actor Elizabeth Taylor, routed more than €1.1 billion of international sales through its Irish unit last year, up almost 10 per cent.

Bulgari Ireland, a lynchpin of the brand's global operation, more than doubled its profits in 2017 to €109 million, according to accounts recently filed in Dublin. The increase in profits was down to improved sales, especially in Asian countries, but it was also boosted by a €35 million return on financial investments.

The brand, now owned by the listed luxury good giant LVMH Moet Hennessy, redirects jewellery sales from across the globe to its Irish unit, in a structure similar to that employed by several major tech companies.

Notes to the company's accounts suggest that more than one quarter of Bulgari Ireland's sales last year came from transactions between the Dublin company and outside buyers, most likely retailers or distributors from elsewhere in Europe.

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About €863 million, however, appears to have been redirected from other Bulgari units elsewhere. Within this, the figures suggest, about €120 million of the Irish unit's sales were actually derived from jewellery sold in Japan.

A further €120 million came from the Americas, while €474 million came from the Far East (not including Japan). This figure is almost €100 million higher than last year, as the newly wealthy in developing economies such as China further developed a taste for conspicuous consumption.

Middle East sales

The Middle East (€133 million) is another lucrative market for Bulgari's luxury products. Intercompany balances tacked on to the Dublin unit's accounts suggest close to €19 million sales from the wealthy emirate of Qatar were redirected to Ireland. About €4.2 million came from Kuwait, with a further €37 million from elsewhere in the Gulf region.

The Dublin unit has 141 staff. It has been reported that Bulgari Ireland is pencilled in for a newly developed logistics operation at Green Reit's Horizon Logistics Park near Dublin Airport.

Bulgari Ireland's use in the brand's global tax structures has attracted close scrutiny from tax authorities in its home country of Italy. The group made a €42 million settlement with Agenzia delle Entrate, which enforces Italy's financial laws, in February 2014, but the company insisted it had done nothing wrong.

In April of this year, more than a dozen executives linked to the group, including the heirs to the Bulgari family fortune, Nicola Bulgari and his brother Paolo, were cleared of tax evasion following a trial that focused on the use of the Irish operation.

When asked about its Irish unit’s performance, Bulgari said it does not comment on financial matters.