De Sole moves to dismiss Gucci worries
The president of the Florentine fashion house Gucci has shrugged off analyst worries about the health of the group’s core Gucci brand.
Speaking at the announcement of Gucci group’s third quarter results earlier today, president Dominco de Sole said he did not believe the 5.1% decline seen in Gucci brand sales during the quarter signalled a problem with the brand itself. Rather, he saw it as a symptom of the wider economic slowdown seen in luxury and travel sales and the looming threat of war with Iraq.
In the three month period ended October 31, Gucci brand sales amounted to Eur355.7 million, with the brand’s contribution to overall earnings before interest and tax falling 11.8% to Eur90.8 million. Group sales amounted to Eur644.8 million – up 3.2% on the year before, while net profits were down by 14% to Eur61.9 million. The figures were in line with Gucci’s warning last week that full year earnings would fall well short of their previous target of Eur2.60 per share and come in at around Eur2 instead.
Revenues at Yves Saint Laurent, the Parisian fashion label acquired by Gucci group in 1999, continued to surge ahead, rising 52% to Eur37.9 million. Double digit growth was seen across all YSL product categories, with leather goods sales more than doubling.
