PARIS — The weak euro should have little effect on 2010 sales at retail-to-luxury group PPR, since any negative hedging effects will be compensated by its favorable impact on the conversion of revenues from subsidiaries outside the euro zone, PPR chairman and chief executive officer François-Henri Pinault said Wednesday.
This story first appeared in the May 20, 2010 issue of WWD. Subscribe Today.
“The inefficiency of our foreign exchange hedges, if the euro remains at this level, will be largely compensated by the conversion effects of foreign subsidiaries at the group level this year,” Pinault told the annual meeting of shareholders here.
The PPR chief also reiterated that he was looking to sell his retail activities, including books and electronics retailer Fnac and furniture chain Conforama, and subsequently reinforce the group’s luxury portfolio through targeted acquisitions — but that he was in no hurry.
Responding to a shareholder’s question about the expansion of Coach Inc. into Europe, Pinault noted that PPR did not directly compete with the American accessories brand, but could be interested in acquiring a brand in the same lower-price category. “Not Coach though, it’s too expensive for us,” he hastened to add.
Asked about the prospect of a share split, PPR chief financial officer Jean-François Palus said the group might consider a 2-to-1 or 3-to-1 division if its share price continues to rise. PPR shares closed down 4.1 percent on Wednesday at 100.30 euros, or $124 at current exchange rates, having more than doubled in value since the start of 2009.
The group took advantage of the meeting to award its first company-wide Innovation and Sustainable Development Prize. The first prize of 25,000 euros, or $30,880, went to Puma Switzerland for designing a carbon-neutral store for India that should become a template for other stores.
By an overwhelming majority, shareholders approved the nomination of three women to the board: Laurence Boone, chief economist at Barclays Capital France; Yseulys Costes, chairman and ceo of advertising, marketing and research firm 1000mercis.com, and Caroline Puel, chief correspondent for Le Point in Northeast Asia.