Gucci owner Kering reports 46% drop in first-half net profit

FILE PHOTO: People walk outside a Gucci shop in Rome, April 20, 2023. REUTERS/Remo Casilli

PARIS, France — French luxury group Kering reported Tuesday that its net profit plunged 46 percent during the first half, with sales falling again at its flagship Gucci brand, as the group awaits a new CEO to try to regain its footing.

Group net profit fell to 474 million euros ($547 million) in the first half from 878 million in the same period last year. Sales were down 16 percent at 7.6 billion euros.

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Kering announced in June that it had poached Luca de Meo, then the head of French automaker Renault, to become chief executive and help turn around the company alongside Francois-Henri Pinault, who will remain board chairman.

READ: Struggling Gucci owner names new CEO

“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 said in a statement.

Gucci remains the prize in Kering’s stable of brands, generating 44 percent of its sales and roughly two-thirds of its operating profit.

But it has struggled to turn things around at the Italian fashion house famous for its handbags, and in March it wooed the Georgian designer Demna to take over as artistic director.

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READ: Georgian designer Demna leaves Balenciaga for Gucci

Gucci’s sales dropped 26 percent in the first half to 3.03 billion euros, for an operating profit of 486 million euros — down 52 percent.

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