Gucci leads double-digit sales decline for Kering

French luxury goods company Kering has reported double-digit sales decline for the first half, with Gucci continuing to drag down the company’s performance.

For the six months ended June 30, group revenue plunged 16 per cent to EUR7.6 billion (US$8.7 billion). This included a 14 per cent decrease in the first quarter and 18 per cent drop in the second.

Gucci continued to be the main underperformer with sales down 26 per cent. Yves Saint Laurent saw a 11 per cent drop, and other houses reported a 15 per cent decline.

Meanwhile, sales were up 1 per cent at Bottega Veneta and 2 per cent at the Kering Eyewear and Corporate segment, which includes Kering Beaute.

Despite the overall decline, the company said there was a slight improvement in North America and Asia-Pacific during the second quarter. Western Europe and Japan continued to decelerate, mainly due to a sharp decline in tourism.

“In a particularly tough market environment, we continued to streamline our distribution and cost base, and, executing on our roadmap, we took decisive steps to strengthen our financial structure,” said chairman and CEO Francois-Henri Pinault.

On the bottom line, attributable net income was EUR474 million compared to EUR878 million in the year-ago period.

“Though the numbers we are reporting remain well below our potential, we are certain that our comprehensive efforts of the past two years have set healthy foundations for the next stages in Kering’s development,” Pinault added.

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