Sales at Kering accelerated in the second quarter, beating analysts’ forecasts for the luxury group and confirming that its flagship Gucci brand was in full recovery mode.
The Paris-based group headed by Francois-Henri Pinault on Thursday said that group revenue in the three months to the end of June was €2.97bn, a whopping 6.9 per cent higher on a comparable basis than a year earlier – well above analysts’ estimates, writes Adam Thomson.
But the star of the show was Gucci, whose sales of €1.05bn during the second quarter were 7.4 per cent higher on a comparable basis than a year earlier. Analysts had said that anything above 2 per cent growth at the flagship brand would be impressive.
Luca Solca, luxury analyst at Exane BNP Paribas described the numbers as “a strong set of results”. He added: “The Gucci turnaround is working.”
The Gucci recovery comes under the new creative direction of Alessandro Michele, who was appointed in January last year following the exit of Frida Giannini from the fashion brand.
Born in Rome, Mr Michele has worked for Gucci for more than a decade, and as associate designer to Ms Giannini prior to his promotion.
Sales at Yves Saint Laurent grew a stellar 22.1 per cent during the second quarter in comparable terms, bringing revenue growth at Kering’s luxury division to 5.2 per cent during the period.
The only dark spot was Bottega Veneta, Kering’s second-biggest luxury brand by revenue, which saw sales fall 9.8 per cent – even more than the 8.3 per cent contraction during the first three months of the year.
Total revenues in the first six months of the year were €5.69bn, 5.5 per cent higher in comparable terms with the same period last year. Operating income for the first six months was €811.1m, 4.9 per cent higher than in 2015. The operating margin was 14.2 per cent, an increase of 20 basis points.
In a statement, Mr Pinault said he was “pleased with the performance”. He added:
Overall growth in our Luxury activities in the second quarter significantly outpaced the level reached in the first three months of the year. Gucci’s creative momentum and ambitious strategy, launched last year, are delivering tangible results: sales growth is accelerating in the second quarter on top of tough comps.
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