Kering Books Mixed 1H as Gucci Lags, Saint Laurent Shines — Earnings Review

By Joshua Kirby

French luxury-goods group Kering reported second-quarter and first-half results on Wednesday. Here’s what we watched:

SALES: Sales in the second quarter rose 12% on year to 4.97 billion euros ($5.07 billion) in line with analysts’ expectations, according to a pre-results poll compiled by FactSet. This took the half-year total to EUR9.93 billion. Mainstay fashion house Gucci booked quarterly sales of EUR2.58 billion, up 4% and similarly in line with analysts’ forecasts.

EARNINGS: Operating profit for the six-month period outstripped sales growth, rising 26% to EUR2.82 billion, slightly ahead of analyst expectations on an operating margin that rose to 28.4%.


-GUCCI IN CHINA: Gucci’s high exposure to lockdown-squeezed China dragged its top line in the second quarter; stablemates that make less of their sales there posted much higher organic increases on year. With management flagging no return yet to growth in the key market, Gucci could be some way off getting back to form.

-YSL MOMENTUM: Yves Saint Laurent kept up recent pace in 2Q, netting a 31% organic sales rise and a record 1H margin at 29.6%. Kering has major plans for its second-biggest brand, and the fashion house impressed again, analysts at Jefferies said in a note following the print, pointing also to a expectation-beating performance from Balenciaga.

-MARKET REACTION: Investors don’t seem overly concerned by Gucci’s lackluster performance, with Kering shares gaining 2.05% to EUR538.80 on Thursday morning.

Write to Joshua Kirby at [email protected]; @joshualeokirby

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