Elevated by strong gains in its Gucci and Yves Saint Laurent brands, Kering saw revenue rise substantially, with increases in all regions, in the first quarter.
In a Nutshell: Luxury powerhouse Kering reported a sharp rise in revenue from its brands, with healthy organic growth across regions, countries and distribution channels. The Paris-based company said Gucci’s strong growth path continued with a 48.7% comparable revenue gain, while Yves Saint Laurent saw sales gain 19.6% and the ongoing implementation of Bottega Veneta’s action plan resulted in a 0.7% sales increase.
Directly operated stores saw strong growth with a 39.9% comparable stores gain in the period, with double-digit growth in all geographic regions, particularly North America and Asia Pacific. Online sales more than doubled during the quarter and revenue from the wholesale network rose 30.5% on a comparable basis.
Sales: Consolidated revenue in the first quarter increased 27.2% on a reported basis to 3.11 billion euros ($3.79 billion), and was up 36.5% on a comparable basis.
Gucci’s reported revenue rose 37.9% to 1.87 billion euros ($2.28 billion), with sales in its directly operated stores recorded double-digit growth and rose 50.4% on a comparable basis. Revenue posted sharp increases in all geographic regions, particularly North America and Asia Pacific. Gucci’s online sales, driven by the U.S., reported triple-digit growth. The collections were also successful in the wholesale segment, with a 43.5% revenue gain.
Yves Saint Laurent continued to grow at a fast pace, with revenue up 12 percent to 408.2 million euros ($496.8 million) as reported and 19.6% on a comparable basis. Sales in directly operated stores rose 15.5%, propelled by strong revenue in North America, Asia Pacific and Japan. The wholesale sector also posted strong growth, driven by Western Europe.
CEO’s Take: François-Henri Pinault, chairman and CEO, said: “Kering maintained its outstanding sales momentum in the first quarter. Under its new luxury pure player profile, the group clearly outperformed a market that remains well oriented. Gucci, Saint Laurent and Balenciaga set a high mark within a group that delivered sharp growth as a whole. In the balance of the year, we face a high base of comparison and a tough currency environment, but we are confident in the ability of our houses to continue doing better than their peers, leveraging their innovativeness and creative audacity.”