The French luxury group Kering continues to suffer from the problems of its main brand Gucci. On Tuesday evening, the group of companies announced a break -in of its net profit by 46 percent in the first half of the year. The profit fell below 500 million euros. The new CEO Luca de Meo is to take office in mid -September to initiate the turnaround.
The group’s turnover, including the brands Yves Saint Laurent, Bottega Veneta and Balenciaga, fell by 16 percent to 7.6 billion euros in the first half of the year.
“Although the published results are still far below our potential, we are convinced that the efforts undertook in the past two years have created a solid basis for the next development steps from Kering,” said Chairman and CEO François-Henri Pinault in a press release.
As a highlight of the restructuring for the renovation of the group, Kering announced the appointment of Luca de Meo in mid -June. The ex-boss of the automobile manufacturer Renault will occupy a newly created position as CEO alongside François-Henri Pinault. Pinault will continue to chair the Board of Directors. De Meo will take up his office on September 15th.
The group continues to be faced with “an uncertain economic and geopolitical environment”, according to a message. Kering confirmed his “will to move permanently on a profitable growth path”.
In the meantime, profitability continued to suffer in the first half of the year: the adjusted operational margin fell to 12.8 percent, compared to 17.5 percent in the same period last year.
Gucci’s sales drop by more than a quarter
The main problem of the Kering Group is that he fails to boost Gucci’s sales again. The Italian flagship mark alone makes up almost 50 percent of the group sales and two thirds of its operational profitability. Gucci’s revenues decreased by 26 percent to three billion euros in the first half of the year. In the same period last year, they had reached over four billion euros. In the second quarter, Gucci recorded a decline in sales by 27 percent to 1.46 billion euros.
The other brands of the group cannot save the situation either: Yves Saint Laurent’s sales decreased by eleven percent to 1.29 billion euros. The “other houses”, which belong to Balenciaga, recorded a decrease of 15 percent to 1.46 billion euros.
Only the Bottega Veneta brand known for their braided handbags could assert itself from one percent to 846 million euros with a slight increase in sales. The glasses division Kering Eyewear and the cosmetics segment with an increase in sales from two percent to a total of one billion euros could also increase.
This article was used with digital tools translated.
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