Kering revenues fall 4% in FY23 despite ‘stable’ sales

Kering, the group that operates Gucci, Yves Saint Laurent and Bottega Veneta, reported that revenues declined 4% to €19.6bn (£16.7bn) in 2023, despite “stable” sales across its network of websites and stores. The luxury fashion group has attributed its performance to the “significant” impacts from changes in exchange rates and the scope of consolidation. As a result, operating income at the year’s end totaled €4.7bn (£4bn), spelling a drop of 15% from the previous year. The group’s attributable net income amounted to €3bn (£2.5bn) and its free cash flow from operations was €2bn (£1.7bn) in 2023. Excluding real estate acquisitions and disposals, free cash flow from operations was €3.3bn. During 2023, wholesales and other revenues also saw an 11% decline on a comparable basis. This was due to the group “further strengthening the exclusivity” of its Houses’ distribution. During the Golden Quarter, revenues were also down 6%, as sales from the directly-operated retail network dropped 2% on a comparable basis. However, the group maintained that revenues grew in Asia-Pacific and Japan over the fourth quarter, while trends in Western Europe and North America improved sequentially. François-Henri Pinault, chairman and CEO of Kering, said: “In a trying year for the group, we strengthened our organisation and took significant steps to further enhance the visibility and exclusivity of our Houses. “We are focused on revitalising Gucci, leveraging the unique blend of craftsmanship, Italian heritage, and modernity that characterises this iconic House. The launch of Kering Beauté and the acquisition of Creed, a storied maker of high-end fragrances, will enable us to capture our share of the steadily growing beauty market.” He added: “In a market environment that remains uncertain in early 2024, our continuing investments in our Houses will put pressure on our results in the short term. Thanks to the experience gained across the group through a decade of outstanding expansion, we are confident in achieving our long-term ambitions.”