PARIS (Reuters) -Revenue at Kering’s Gucci fashion label rebounded strongly in the first quarter, adding to signs of a comeback for the broader luxury goods industry as COVID-19 restrictions ease in major markets like China and the United States.
Sales of high-end fashion and handbags are soaring again as vaccinations progress and stores re-open, although new coronavirus lockdowns in much of Europe are holding back momentum there, while international travel is still on ice.
The Kering conglomerate’s overall sales rose and Gucci, which accounts for 60% of Kering’s revenues and 80% of its profits, posted comparable revenues up by 24.6%, ahead of analysts’ consensus forecast for 19% growth.
That is likely to soothe investor concerns that the brand is losing steam after five years of stellar growth, after it lagged some major rivals in 2020.
But fashion labels at Kering’s arch-rival LVMH’s, which include Louis Vuitton, performed even more strongly in the first quarter, and Bernstein analyst Luca Solca said this could potentially weigh on Kering’s shares.
Gucci is hoping to capitalise on its centenary year to attract fans with events and new collections, including one presented online last week where Gucci designs were crossed with silhouettes and logos by Balenciaga, another Kering brand.
The show has had 205 millions views online, Kering Finance Chief Jean-Marc Duplaix told reporters, adding it confirmed renewed momentum at the brand.