French luxury group PPR, the business behind brands including Gucci, Stella McCartney and Alexander McQueen, saw profits rise for the second quarter as it looks to sell its mail order division Redcats by the end of the year.
The group’s overall sales growth in the second quarter rose by 5.4%, however this was a slowdown in growth compared to a 9.1% rise in the first quarter of 2011. PPR posted sales of €3.51bn (£3.07bn) in the three months to June 30, up 8.4% on a like-for-like. PPR’s profits climbed 16.1% in the first half to €450m (£394m).
Sales at the Redcats Group were down 3.6% to €821.5m (£719.3m), which was the worst performance of any division in the second quarter. PPR aims to sell of its mail order division by the end of the year but has said it will delay the sale if the global financial markets plummet.
Chief executive officer François-Henri Pinault said: “These results do not call into question the sale, particularly since Redcats registered very strong growth last year…Redcats has confirmed its turnaround and is showing consistent improvement.”
Brands in the Redcats division, which includes the plus-size retailer Avenue, casual chic clothing brand Somewhere and catalogue retailer La Redoute, are all under close scrutiny ahead of the sale, which PPR aims to complete within the next six months.
PPR’s luxury group division, which includes Gucci, Yves Saint Laurent and Bottega Veneta, saw sales rise 19.2% to €1.11bn (£972m) in the second quarter. Sales at Alexander McQueen too experienced a jump in sales with publicity surrounding Kate Middleton’s wedding dress and a retrospective of the designer’s work at New York’s Metropolitan Museum of Art aiding sales growth.
Puma, PPR’s sportswear brand, reported a sales rise of 9.4%, to €673.5m (£589.7m).