Financials

Kering Sees Q3 Sales Rise 23% in ‘Increasingly Complex Environment’

FinancialsOct 21, 2022

Kering Sees Q3 Sales Rise 23% in ‘Increasingly Complex Environment’

Sales for the division that includes the company’s jewelry brands rose 17 percent, fueled by company-owned stores, not wholesale.

20221022_Boucheron high jewelry ring.jpg
A diamond, rock crystal, and white gold ring from Boucheron’s “New Maharajas” high jewelry collection, released earlier this year. Kering owns Boucheron as well as Pomellato, DoDo, and Qeelin, with sales in the division that includes these luxury jewelry brands up 17 percent in Q3.
Paris—Kering recorded “very solid” growth in the third quarter in what Chairman and CEO François-Henri Pinault described as a “increasingly complex” operating environment. 

The luxury conglomerate reported Thursday that group revenue rose 23 percent year-over-year (14 percent on a comparable basis) to €5.14 billion ($5 billion). 

In the company’s Other Houses division, the division that includes its jewelry brands, revenue rose 17 percent year-over-year (13 percent on a comparable basis) to €995 million ($967.4 million). 

Boucheron and Pomellato recorded “very good performances” while Hong Kong-headquartered brand Qeelin “held out well against the complex operating environment in China,” Kering said, a reference to the ongoing strict COVID measures in place. 

Revenue growth from directly operated stores fueled the Other Houses division’s positive performance, with revenue up 43 percent, compared with a 25 percent drop in wholesale sales. 

Kering, like other luxury conglomerates, noted that it continues to focus more on its company-operated stores rather than wholesale channels. 

On a region-by-region basis, North America recorded the lowest year-over-year sales growth by far, with revenue growing only 1 percent, compared with 74 percent in Western Europe and 31 percent in Japan.

However, Kering noted that North America was up against high comps from last year and a lot of Americans spent money as tourists in Europe, helping to fuel that region’s “outstanding” growth. 

 Related stories will be right here … 

While Kering’s Other Houses division continued to post double-digit year-over-year revenue growth, it was not the luxury conglomerate’s top performer. 

With comp sales of growth of 13 percent, it lagged Yves Saint Laurent (up 30 percent), Bottega Veneta (up 14 percent), and the newly renamed Kering Eyewear and Corporate division (up 23 percent), but topped Kering’s biggest brand, Gucci. Year-over-year comp sales for the brand rose only 9 percent. 

Commenting on the company’s performance, Pinault said: “Kering’s solid performances in the third quarter underscore the strength of the group and the pertinence of our strategy … Our ongoing focus on the exclusivity of our brands and on the quality of their distribution are yielding very positive results and reinforce their positioning in their key markets. 

“In an increasingly complex environment, we maintain the required flexibility to support our profitability and sustain our investments in the long-term outlook of all our houses, Gucci first and foremost. We are as confident as ever in the potential and prospects of the group.”

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