Boosted partly by “excellent sales” of Frida Giannini’s debut ready-to-wear collection for Gucci, luxury goods sales powered ahead 19 percent at Gucci Group to 846.8 million euros, or $1.02 billion, in the first quarter — yet another bubbly showing for the high-flying sector.
The Gucci brand, experiencing a “boom” in sales in the Asia-Pacific region, posted growth of 18.2 percent to 508.3 million euros, or $611.2 million, in the three months ended March 31.
Reflecting improving household consumption in France, but less buoyancy in its vast retail operations, overall sales at conglomerate PPR rose 7.9 percent to 4.43 billion euros, or $5.33 billion. The retail portion logged a 5.6 percent uptick to 3.59 billion euros, or $4.32 billion. (Dollar figures are converted from euros according to average exchange rates for the period.)
“This quarter is definitely reflecting the good momentum of every quarter last year, the improvement of the economic environment and our growing international activities,” chief financial officer Jean-François Palus told analysts during a conference call Thursday. “We are very satisfied with these figures.”
He also assured that PPR’s far-flung retail chains — selling everything from cars and books to furniture and pharmaceuticals — had “regained traction.”
Meanwhile, he boasted that its leather goods and fashion activities vaulted 25 percent, “outperforming key competitors.”
Gucci said it posted double-digit growth in all geographic areas, including Japan, where sales jumped 10.8 percent. Sales leaped 34.5 percent in the Asia-Pacific, 21.1 percent in North America and 16.7 percent in Europe.
Although Giannini received mixed reviews for her spring-summer 2006 collection of peak-shouldered dresses, cashmere rugby shirts and tomboy-ish pantsuits, sales of women’s rtw posted a 24.3 percent gain to 37.9 million euros, or $45.6 million, the biggest improvement among Gucci’s various product categories.
Sales of leather goods rose 20.2 percent to 294.3 million euros, or $353.9 million, while shoes stepped up 21.2 percent to 70.2 million euros, or $84.4 million. Wholesale orders also vaulted 22 percent, accounting for 29 percent of sales, but Gucci watch sales were described as “disappointing.”Bottega Veneta, which Palus characterized along with Gucci as a key driver of PPR’s luxury division, posted the biggest gain, with accessories and rtw sending sales up 79.2 percent to 58.5 million euros, or $70.3 million. Leather goods — including Bottega’s signature woven bags — accounted for 83 percent of revenues in the quarter.
PPR cited improvements at its money-losing Yves Saint Laurent fashion house.
An 8.5 percent rise in first-quarter sales to 42.4 million euros or $50.9 million, and a 15.5 percent gain in its network of 62 boutiques, “confirms the positive reception given to the collections presented by Stefano Pilati,” PPR said.
Wholesale orders at YSL were up 30 percent and the Muse bag was the brand’s top-performing item in the quarter, Palus said. Still, he declined to give a breakeven date for YSL, reiterating that it would come when the brand achieved annual sales of 300 million euros, roughly double what they are now.
Sales of “other brands” rocketed 37.3 percent to 95.3 million euros, or $114.6 million. These include Balenciaga, Boucheron, Sergio Rossi, Bedat & Co., Stella McCartney and Alexander McQueen. PPR did not break down sales by brand, but Palus highlighted “triple-digit” growth at Balenciaga.
Reflecting competitive pressures, sales at YSL Beauté inched up 1.2 percent to 142.3 million euros, or $171.1 million. PPR characterized the performance as disappointing, with sales down in fragrances and skin care.
Analysts pummeled Palus with questions about the ailing division. He declined to quantify the cost savings of a restructuring plan that will see YSL shed about 160 manufacturing and administrative personnel, but asserted it would produce a “very significant impact at the end of this year and mainly next year.”
Palus also sidestepped a question about PPR’s willingness to dispose of the unit, saying: “We plan to improve the situation at YSL Beauté. This is our major concern right now,” he said. “We think we can achieve far better profitability.”
PPR described retail activities as steady. Long-sluggish France showed signs of improvement, with sales up 3.1 percent on a comparable basis.
Its biggest business, Redcats, posted a 1.2 percent sales gain to 1.07 billion euros, or $1.29 billion. PPR highlighted strong sales of special sizes in the U.S. and Redcats’ children’s and family division.Sales at PPR’s Fnac book, record and electronics chain increased 6 percent to 1.02 billion euros, or $1.27 billion, with Brazil, Spain, Italy and Belgium outpacing its domestic business. At Printemps department stores, sales rose 1 percent to 181.7 million euros, or $218.5 million, while Conforama furniture stores cited a 5.7 percent increase to 755.9 million euros, or $909 million.
Shares of PPR slipped 0.8 percent to close at 103 euros, or $128.23 at current exchange, on the Paris Bourse.
@kering_official is spinning off its stake in puma in an effort to focus on its luxury brands, the brand operator announced yesterday. “We are proud to have supported the turnaround of Puma, which now has unrivaled capabilities to take full advantage of the specific dynamics of its global markets and is poised to achieve substantial growth,” said François-Henri Pinault, Kering’s chief executive officer and chairman. Artémis will become a “long-term strategic shareholder” of Puma with a 29 percent stake. #wwdnews #wwdfashion (📷: @jilliansollazzo)
The fashion world mourns for celebrated street style photographer, Nabile Quenum, who died at age 32 in Paris.
Quenum, creator of the fashion blog “J’ai Perdu Ma Veste,” was a fashion week fixture, and regularly shot for New York magazine’s The Cut, among other outlets, and brands such as Louis Vuitton, Moncler and Adidas. He was also actively involved in the #NoFreePhotos initiative, which kicked off in the fall. Read more about Quenum in @kbsmoke's story on WWD.com. #wwdnews
@verwanggang and @maisonladuree have teamed up on a dessert collab called Vera Wang Pour Ladurée. The collection, which launched this week, features a specialty macaroon, as well as a wedding cake inspired by one of the designer’s gowns. “I could not imagine a more delicate or sophisticated creation to grace any couple’s celebration,” said Wang. #wwdfashion
“I’m Russian and I love to use all these little tricks that I got from my grandma or my mom. We didn’t have a lot of money for creams or anything like that so we would use a garden as a beauty treatment regime. We’d put cucumber in the fridge and do a cucumber mask,” says model @irinashayk on one of her beauty hacks. WWD asked celebs what their go-to self-care rituals are. See what Naomie Harris, Freida Pinto and more said on WWD.com. #wwdeye #wwdbeauty (📷: @zefashioninsider)
Exclusive: @viktorandrolf are teaming up with @Zalando on a collection made from leftover clothing. The lineup, which lands at the retailer February 1, includes 17 pieces adorned with sliced up and repurposed overstock from the retailer’s private label collection. Pictured here is a look from the collection –– see more on WWD.com. #wwdfashion #wwdnews
@duewestnyc is the newest bar joining the collection of intimate neighborhood-focused spaces in the West Village. The cocktail menu, which includes bitters and syrups made in-house, offers a “Build Your Own Old-Fashioned” – like the one pictured here – where guests can choose from a list of spirits and unexpected sugars and bitters. #wwdeye
Spotted at last night’s National Board of Review gala in NYC: Angelina Jolie. Jolie – along with Meryl Streep, @lupitanyongo and more – continued the all-black dress code from Sunday’s Golden Globes. #wwdeye (📷: @lexieblacklock)