AT THE Fall/Winter shows in Paris earlier this year, Miu Miu - designer Miuccia Prada's second line - presented luxe coats with bold, wide collars; smart frocks; flamboyant chinchilla sashes; silken singlets; and skirts that were cut austerely but embellished generously. It was a romantic collection, one that was not only fit for the runway - but for the new generation of Miu Miu stores too.

The latest of these opened at Ion Orchard on Tuesday, displaying a plushly carpeted, damask-wallpapered interior that was as pretty as the clothes themselves. The 2,800 sq ft space is the first of four new shops at the mall by the Prada group that will grow the company's presence here significantly.

And it enforces the group's global strategy of 'consolidating and expanding our brands' retail network in Asia and in other parts of the world', says Prada chief operating officer Sebastian Suhl, who was in town for the opening. 'We want to focus on direct retail, which totals 70 per cent of our revenue.'

The three other stores that the group will be opening at Ion Orchard later this year are a 14,000 sq ft boutique for its flagship brand Prada - that will be Asia's largest 'at least for a few months', until a 16,000 sq ft mammoth outlet opens in Shanghai's Plaza 66 - as well as two others for the new-to-Singapore brands, Car Shoe and Church's. 'I think new brands in Asia have great potential, and at the same time there's nothing quite like interesting new brands,' says the Hong Kong-based Mr Suhl, who has been with the company since 2001 and was previously chief executive officer of Prada Asia Pacific.

Beneath the group's gleaming exteriors though, all is not as well as it appears. Prada has been flailing financially since a series of non-profitable acquisitions in the 1990s left it debt-ridden.

The buying spree included Helmut Lang, Jil Sander and a 25.5 per cent stake in Fendi, all of which were eventually sold off but saddled Prada with a total debt level of about 1.2 billion euros inclusive of loans, according to Bloomberg. About 100 million euros' worth of debt matures this month.

To resolve its finances, the company had planned to raise funds through an initial public offering last year but changed its mind when the markets collapsed.

So what then? While there were rumours last month that Prada was considering selling almost half its shares to a private equity firm, that suggestion has been quashed by the company. 'I can only say what's been said already - that it's not true,' says Mr Suhl.

What the company is more likely to do, as Bloomberg reported back in April, is to ask banks to reorganise its debt to free up cash that will fund new stores and tap consumer demand to generate more money.

After all, the expansion strategy has been proven to work for the group - its total sales last year remained largely unchanged despite the downturn, boosted by contributions from new stores.

States Mr Suhl: 'Business has been exceptional, with year-on-year growth for the past four to five years. We're clearly profitable, otherwise we wouldn't be here now.' To continue on that growth path, Prada - which plans to have some of its largest stores in Asia in the near future - seems to be relying on the more stable East for revenue growth as Western markets flounder, and Mr Suhl says as much. 'The Asia-Pacific market currently contributes 20 per cent of our revenue . . . we see Singapore as a hub for South-east Asia, with a positive history in terms of sales growth,' he states.

'From here, we hope to capture markets from Malaysia, Thailand, Indonesia and India as well.' He is quick to emphasise, though, that the group is also growing in Europe and the United States, although 'understandably, that has been greater hit'.

There are other reasons for the expansion in Singapore now too. 'Previously, we didn't have much room for expansion but that's changing with the opening up of spectacular spaces for the first time in 10 years. There are now real opportunities, I think for the first time since Ngee Ann City, with the new malls and the integrated resorts,' says Mr Suhl. When the latter is completed, Prada may have an even bigger presence in Singapore - the group is 'looking at Marina very seriously', he adds.

While it's easy to justify expenditure on retail spaces that help to boost total sales, what of the costly art and architectural projects that Prada so fervently supports? Just three months ago, for instance, the company unveiled its Prada Transformer structure by Rem Koolhaas in Seoul, which cost US$10 million to build.

'That generated an immense amount of publicity; it was all over the world,' counters Mr Suhl. Such 'communication platforms', he adds, help Prada's career and build on its image as a 'curious, innovative house'.

Then he ends on a note that suggests he has already been asked too many questions about the financial health of the company: 'It allows people to see Prada for what it is.' That, however, may well depend on the eye of the beholder.

This article was first published in The Business Times