Boucheron, Qeelin Excel in Kering’s Q1

FinancialsApr 21, 2021

Boucheron, Qeelin Excel in Kering’s Q1

The luxury titan’s jewelry and watch brands kicked off the year on a high note.

An 18-karat rose gold and malachite “Deep Forest” ring accented with black diamonds ($11,500) by Kering-owned brand Pomellato. The luxury conglomerate’s watch and jewelry brands performed well in the first quarter.
Paris—Kering’s fiscal year began on a high note, with revenue climbing double digits as sales surged in North America and Asia-Pacific.
The company behind Gucci, Yves Saint Laurent and other high-end brands posted revenue of €3.89 billion ($4.68 billion), a 26 percent increase on a comparable basis.
In the first quarter, Kering delivered a strong topline performance, bouncing back above pre-pandemic levels, said CEO François-Henri Pinault in a press release about the results.
“Growth was consistent across all our houses, and we are particularly pleased with Gucci’s momentum as the brand kicks off its centennial celebration.”
Retail sales from its directly operated stores were up 32 percent when compared with last year’s first quarter, which saw a slew of COVID-19-related store closures.
Compared with the first quarter of 2019, sales in this category were up 6 percent.
Due to the ongoing COVID-19 pandemic, 17 percent of its worldwide store network was closed in the first quarter, compared with 12 percent in last year’s first quarter.

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Wholesale sales were up 9 percent year-over-year as the company works to streamline the segment.
Online sales more than doubled, up 108 percent year-over-year, accounting for 14 percent of retail sales.
E-commerce sales grew the most in North America, up 134 percent year-over-year.
The company’s watch and jewelry brands, including Pomellato and Boucheron, fall into its “other houses” division, alongside Alexander McQueen and Balenciaga.
First-quarter revenue in the “others” division totaled €714.3 million ($859.1 million), a 33 percent increase on a comparable basis.
In this division, retail sales were up 29 percent while wholesale revenue was up 38 percent.
Alexander McQueen and Balenciaga were the category’s top performers as the brands strengthened their foothold in the Asia Pacific region.
Boucheron has been rolling out an expansion plan, seeing strong growth in mainland China and Korea.
Pomellato is “rebounding nicely,” said Kering, while Qeelin has seen “outstanding development.”
In its watches category, the company reported “positive development with healthy sell-through.”
By region, overall sales in North America were up 46 percent while sales in Western Europe fell 34 percent.
Sales in the Asia Pacific region surged 83 percent while sales in Japan slipped 3 percent.
Kering did not provide guidance for the fiscal year.
Pinault noted that while the pandemic will likely continue to impact the company, its brands are in good standing to weather the year ahead.
Recent reports suggested Kering had made an offer to acquire Richemont, but it was declined. Neither party confirmed the reports.

Lenore Fedowis the associate editor, news at National Jeweler, covering the retail beat and the business side of jewelry.

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