(News Bulletin 247) – The group announced that it anticipates a 10% decline in its revenues on a comparable basis over the first three months of the year, including a fall of almost 20% for its flagship brand Gucci.

Kering issues revenue warning. The luxury group delivered this Tuesday preliminary indications for its first quarter which are hardly encouraging.

“During a half-year that Kering anticipated would be difficult, current trends lead to an estimated drop in consolidated revenue of around 10% (on a comparable basis, Editor’s note) in the first quarter of 2024 compared to the last year”, announces the company in a very clear press release.

This drop in activity is mainly due to a poor performance of its flagship, the Italian label Gucci, which represented around half of the company’s revenues in 2023 and almost 70% of its current operating profit.

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Gucci down almost 20%

The Italian brand experienced a more marked decline than expected, particularly in the Asia-Pacific region. Gucci’s turnover over the first three months of the year is expected to fall by almost 20% year-on-year on a comparable basis.

Gucci has seen its momentum suffer in recent quarters with a decline in its sales of 2% on a comparable basis in 2023, including a drop of 4% over the last three months of last year.

The Italian brand is currently in the midst of a creative transition. A new, young artistic director, Sabato de Sarno, a defector from Valentino, joined the group last year. Its first collection, Ancora, was presented during the fall fashion week in Milan for women and in January, also in Milan, for men.

“The first products from the Ancora collection began to be available in certain Gucci stores since mid-February and mainly in the Ready-to-Wear category. The new collection, whose deployment should gradually accelerate over the coming months, receives a very good reception”, assured Kering on this last point.

Kering will publish its full sales figures on April 23 after the Paris market closes.

The Parisian market will react to Kering’s warning on Wednesday. For the moment on the New York Stock Exchange, the ADR – certificates of deposit which allow investors in the United States to position themselves in foreign groups – plunged by 6.7% following this announcement.