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PARIS – Signaling luxury’s strong resilience in an uncertain economy, PPR said net profits in the first half catapulted 140.9 percent, largely due to a capital gain on the sale of YSL Beaute, but also reflecting a “very satisfactory level of profitability in luxury goods.”
Hermes said it planed to continue investing in its retail network,emboldened by robust sales of silk scarves, leather goods and perfumes that lifted first-half sales 12.8 percent to 813.2 million euros, or $1.24 billion.
At PPR, its group share of net income amounted to 779 million euros, or $1.19 billion, versus 323 million euros, or $494.4 million, a year ago.
Income from continuing operations rose 17.3 percent to 344 million euros, or $526.5 million, from 293 million euros, or $448.5 million. Dollar figures are converted from average exchange rates for the period. While Redcats and Conforama remain trouble spots for the conglomerate, operating profits at Bottega Veneta vaulted 60 percent at constant exchange to 51 million euros, or $78.1 million, while Yves Saint Laurent halved its operating loss to 12 million euros, or $18.4 million.
Pinault asserted that PPR “has always been able to take advantage of periods of slower growth and the present case is no exception. We are determined to further improve our commercial effectiveness and optimize our operational structure in order to benefit from a decisive and immediate competitive advantage as soon as there is an upturn.”
As reported, improved sales at Gucci in the second-quarter lifted PPR sales by 11.8 percent in the first half to 9.58 billion euros, or $14.06 billion, versus 8.57 billion euros, or $13.12 billion, a year ago.
For complete coverage, see Tuesday’s edition of WWD.