Kering First-Half Profit Exceeds Estimates on Luxury Sales Surge
Kering SA (KER), owner of the Gucci brand, reported first-half profit that beat estimates as accelerating luxury-goods revenue compensated for lower sporting-goods sales.
So-called recurring operating income advanced 2.3 percent to 843 million euros ($1.1 billion) in the six months ended June 30, the Paris-based company, formerly known as PPR, said today in a statement. Analysts predicted 824 million euros, the median of 16 estimates surveyed by Bloomberg.
Second-quarter luxury sales rose 9.4 percent on a comparable basis, accelerating from the previous quarter’s 6.4 percent gain and beating the 7.5 percent median analyst estimate. Puma SE (PUM), the sporting-goods maker owned by Kering, yesterday reported reduced sales and profit and said it expects a challenging second half.
“Trends recorded in the first six months of 2013 should continue in the second half,” Kering said in the statement. “In this context, the group maintains its goal of improving its operating and financial performances in the full year.”
Comparable sales at Gucci gained 4.1 percent, accelerating slightly from the first-quarter’s 4 percent increase.
Total quarterly sales rose 1.6 percent to 2.31 billion euros, or 5.2 percent excluding currencies and acquisitions.
The restated figures exclude media and electronics retailer Groupe Fnac, (FNAC) which the company spun off in June as part of a plan to focus on luxury and sporting goods. Kering has started talks with industrial buyers and private-equity funds over the sale of online and mail-order fashion retailer La Redoute, which it expects to finalize this year.
Hermes International SCA (RMS) said last week that sales growth may exceed 10 percent this year after selling more Kelly handbags and other products in Asia and the Americas. Global luxury sales will rise as much as 5 percent this year, Bain & Co. estimates.
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