Kering scores +17.5% in the first quarter: Gucci “averages” out (2.3 billion, +20%), Bottega Veneta continues to suffer (-8.9%) 

Kering answers LVMH’s performance. The two giants continue to increase their ownership of the luxury marketplace and the data published in these hours by the multinational enterprise, run by François-Henry Pinault, shows just that. The holding has, once again, used its reference brand as its calling card: Gucci.

In the first quarter of 2019, Kering grew its sales“slightly more” than the forecasts had estimated, reaching 3.785 billion euro, equal to a 17.5% increment at constant rates. A performance that Luca Solca, Sanford C. Bernstein’s analyst for luxury industries defined as “Not a big surprise”.

Gucci

The “star brand” is, as always, Gucci, with revenue of 2.3 billion euro which has grown by 20% in comparison to the first quarter of 2018, during which the growth was of +49%. According to Jean-Marc Duplaix, Kering’s cfo, the brand managed by Marco Bizzarri is experiencing a physiological “normalization” phase. Translated: the brand couldn’t continue grow at the same rate as it did the previous year. In particular, it attributes the lost 1.5% of growth to the diminished performance of Chinese and South American customers that make purchases in the United States, a market in which “there is a less favorable environment for retail sales and luxury goods”, stated Kering’s manager, who noticed how Gucci’s footwear and prêt-à-porter (in Europe and the USA) are performing better than leather goods’ collections.

Other brands

Yves Saint Laurent grows 17.5%, thanks to its leather goods’department (+21.7%),while “other brands” had a 21.7% increment. Duplaix highlighted the good performance of Balenciaga’s footwear and prêt-à-porter, along with Alexander McQuenn’s, and how those two are about to reach 1 billion euro in revenue. The only negative note: Bottega Veneta, which loses 8.9%. Duplaix, on the other hand, explained to analysts that the brand is starting to benefit from the positive effect of its new creative director, Daniel Lee, and how his products did in fact do well on the market.

Two new handbag models, for example, quickly sold out, attracting old and new clients, explained Kering. François-Henri Pinault, president and ceo of the holding, commented the results for the first quarter of 2019 by saying: “The agility that we have put at the center of our system positions us well and allows us to continue to reach our growth objectiuve, which is constant, sustainable and profitable”.

In the image, from Gucci.com, the sneaker model Gucci Ace

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