PARIS — The Michael Kors era at Celine comes to an end today with the designer’s farewell show and a send-off party tonight at Pershing Hall.

And as the American designer departs to concentrate on building his own business, Celine — given a fashion boost by Kors over the past seven years — continues on a major roll, projecting double-digit sales growth for 2004.

What’s more, it is understood the brand turned a profit last year for the first time since 1996, aided by a major restructuring and rapid growth in the leather goods category.

“It’s been a very interesting win-win scenario,” Jean-Marc Loubier, Celine’s chief executive, said in an interview this week. “It has been a very good decision to have Michael join the brand. That put Celine on the international stage for fashion, a place it wasn’t before. He brought fashion to Celine.

“It also gave Michael Kors the international exposure he didn’t have before. Before, he was only really known in America.”

Founded in 1945 as a children’s footwear firm by Italians Celine and Richard Vipianas, Celine slowly expanded its offering through the Sixties to include men’s and ladies’ clothing and accessories. The low-profile brand vaulted on to the international business radar in 1987 when luxury czar Bernard Arnault acquired Celine via his Financiere Agache holding company. It became part of the LVMH Moët Hennessy Louis Vuitton fashion universe in 1994.

That Kors was only the second designer after Celine Vipianas speaks to the fact that the brand was not part of today’s “star” system of designer rejuvenation. “It was a company created by merchants,” Loubier said. “In a way it’s very American, and perhaps the first contemporary luxury brand.”

Kors joined LVMH’s Celine at the same time as other emerging American fashion stars — Marc Jacobs and Narciso Rodriguez — were placed at the French group’s Louis Vuitton and Loewe fashion houses. Rodriguez exited Loewe in 2001, while Jacobs is under contract with Vuitton through 2008.

Loubier, who joined Celine as ceo in June 2000 after 10 years at Louis Vuitton, has been the architect of major behind-the-scenes changes at Celine. Product lead times have been slashed; the retail network has been upgraded, and the design, merchandising and marketing functions have been revamped.“We worked a lot on the product, and pushed the teams,” he explained. “It’s very easy to do beautiful $5,000 bags, but how do you do a good one at $800?”

In the late Nineties, leather goods — long the backbone of Celine — had dwindled to less than 7 percent of sales at some of its U.S. stores. Last year, aided by hot handbag styles like the Boogie and Poulbot, leather goods zoomed to 41 percent of brand sales. Within Celine’s network of some 100 stores and corners, handbag sales increased 35 percent last year, Loubier said. Ready-to-wear accounted for 42 percent of sales, footwear 11, and the balance came from other products and royalties.

Overall, Celine sales last year increased 4 percent, or 14 percent excluding the negative impact of currency exchange, Loubier said.

LVMH, which reported full-year earnings Wednesday, does not give volume breakdowns for individual brands but market sources estimate Celine’s volume at around $200 million.

Louis Vuitton chief executive Yves Carcelle, giving highlights of LVMH’s fashion and leather goods business at its analysts’ conference on Wednesday, characterized Celine’s 2003 performance as remarkable. “They’re going from strength to strength,” he said, noting increased appeal of the brand in Japan.

Indeed, Loubier said Japan and the U.S. remain the fastest-growing markets for Celine, with 2003 sales advancing 22 percent and in excess of 25 percent, respectively. He added that the brand isfar ahead of plan in 2004, having seen a sharp acceleration in the last two quarters of 21 percent and 28 percent, respectively.

In the U.S., Celine sells to about 120 doors and operates freestanding stores in Bal Harbour, Fla.; Beverly Hills and South Coast Plaza, Calif., and New York. A new location, in Dallas, is slated to open next month.

At present, roughly 60 percent of itsvolume is in Japan and Asia, with the balance in Europe and the Americas.

Retailers are eager to find out who will drive the fashion department once Kors takes his final bow. As reported, the rumor mill has been in overdrive, with recent speculation focusing on Paris-based Martin Grant and DSquared, the Milan-based twins Dean and Dan Caten. Loubier would only say that no contract has been signed and an announcement isn’t likely until April. In the interim, Loubier said Celine’s rtw design team would start work on the cruise collection.“It’s an important decision,” he said of finding Kors’ replacement. “To work with a designer is always a surprise. You can’t anticipate everything.”

But he said whomever succeeds Kors would be asked to be faithful to the brand’s optimistic spirit, French flavor and smart clientele.

“She’s a woman with a brain, energetic and witty, involved as much in her work as in her leisure,” he said. “We know exactly the person we are targeting to.”

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