Kering Group Revenue Falls 13 Percent in Q3, Confirming Luxury Slowdown
LONDON — Kering’s third-quarter revenue figures further confirmed the luxury slowdown, with group revenue falling 13 percent at reported exchange rates, and 9 percent on an underlying basis, to 4.46 billion euros.
The revenue figure dovetailed with forecasts from analysts, most of whom had already downgraded their expectations for the quarter and their share price targets for Kering.
Sales at Gucci, Kering’s largest brand, were down 14 percent on a reported basis and 7 percent underlying to 2.22 billion euros. Yves Saint Laurent fell 16 percent, and 12 percent underlying, and Bottega 13 percent, and 7 percent underlying.
Kering said its “other houses” division, which is home to brands including Balenciaga and Alexander McQueen, saw sales fall 19 percent on a reported basis, and 15 percent underlying.
François-Henri Pinault, chairman and chief executive officer of the French luxury group, said that beyond the challenging macroeconomic conditions and softening demand across the luxury industry, “the change in our revenue performance in the third quarter reflects the impact of our decisions to further elevate our brands and their distribution.”
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He said the organization that Kering put in place in July “will enable us to strengthen the steering of our houses in the current market environment and to reclaim our positions and influence. With the acquisition of Creed completed last week, one of the world’s most distinguished high fragrance houses has joined our family, propelling our ambitions in beauty onto the next stage.”
Kering has been undergoing a raft of changes, restructuring management, acquiring luxury brands and reducing wholesale distribution in a bid to compete in a challenging and crowded market that has seen a cyclical slowdown in demand.
This story was reported by WWD and originally appeared on WWD.com.
