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Gucci spins money for parent Kering

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Italian luxury brand of fashion and leather goods, Gucci has once again emerged as the biggest money spinner the Kering Group.

Gucci met its financial targets and posted a revenue of € 8.28 billion in 2018, up by massive 33.4 percent and 37 percent in like-for-like terms.

In the year 2018, the fashion retail brand also set a profitability record, accounting for over 80 percent of the Kering’s operating profit at € 3.944 billion.

“Gucci delivered another exceptional year of healthy, extremely well-balanced growth,” said François-Henri Pinault, adding, “Thanks to a massive increase comparable sales in the fourth quarter, it has given a very positive start to the year.”

Comparable sales at Gucci’s stores increased by 38 percent across all product categories, regions and customer segments (by nationality and age), stated Gucci’s Chief Financial Officer Jean-Marc Duplaix.

Wholesale revenue soared 31 percent.

Operating income of Kering grew by 54.2 percent to € 3.275 billion.

In terms of future, Gucci has plans to reach € 10 billion in revenue.

Gucci’s e-sales were reportedly equivalent to 6 percent of retail sales. The online retail business grew 70 percent in 2018.

Gucci also wants to fortify its position in the travel retail channel. The goal is for travel retail to account for at least 10 percent of Gucci’s total revenue.

The fashion brand will also adopt new interiors concept developed by Alessandro Michele, to stock and display a broader range of products.

It is expected to take two to three years to upgrade all of Gucci’s stores as per the new concept.

At the end of 2018, Gucci operated 540 monobrand stores, 11 more than the previous year.

“The store network is stable as of now, but we are working on its quality, in terms of store size, via extensions and improvements to the premises,” said Pinault.

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