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Kering first half profits fall 13% but Gucci rebounds

French luxury brand house Kering’s profits fell 13% to €489m (£348m) in the first half of 2015.

Exchange rate fluctuations helped to boost the group’s total revenue by 17% to €5.5bn (£3.9bn) in the first half. Comparable sales were up 3.5% adjusted for exchange rates, driven by a strong performance in Western Europe and Japan.

Flagship brand Gucci showed signs of recovery following a difficult 2014, enjoying a 4.6% rise in underlying second quarter sales, driven by an increase in tourism. Bottega Veneta and Yves Saint Laurent also did well, while Puma continued to grow in line with its relaunch plan.

Kering’s recurring operating income amounted to €773m (£550m) in the first six months, down 5.4% from first-half 2014 on a reported basis. The consolidated recurring operating margin was 14%.

The group’s gross margin for the first half of 2015 was €3.4bn (£2.4bn), up €397m (£282m) or 13.2% as reported. Consolidated EBITDA came to €972m (£691m), flat year on year, and the EBITDA margin narrowed by three points on a reported basis to 17.6%.

Kering’s chairman and chief executive François-Henri Pinault said: Kering delivered a sound performance in the first half of 2015, buoyed by strong sales growth in the second quarter in a volatile economic and currency environment.

“Our luxury activities, lifted by sales in our directly operated stores across mature markets, continued on a strong upward trend, reflecting the relevance of our strategy and the action plans in place. We are particularly satisfied with the progress at Gucci and the positive reception given to the brand’s new creative direction.

“As we enter the second half of the year, I am fully confident in the group’s ability to combine strict management discipline with organic growth at each of our brands.”

Kering said the recent currency fluctuations were “likely, at this stage, to have a favourable impact on sales” going forward, although it warned this would be mixed across the group.


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