Consolidated revenue: €8,047.2 million
up 49.6% as reported and 54.1% on a comparable basis
Recurring operating income: €2,237.0 million, up 134.9%
Recurring operating margin: 27.8%
Net income attributable to the Group: €1,479.0 million
Recurring net income attributable to the Group : €1,477.4 million
«Kering delivered excellent performances in the first half and resumed its trajectory of strong, profitable growth. All our Houses contributed to a sharp rebound in total revenue, which comfortably exceeded its 2019 level, with a remarkable acceleration in the second quarter. While returning to substantial profitability and leveraging the desirability of our brands, we are stepping up the pace of our investments in our Houses and strategic initiatives, notably to enhance the exclusivity and control of our distribution. Our teams are demonstrating their agility in this fast-moving environment, and we have the right assets, resources and strategy to successfully pursue our journey.»
François-Henri Pinault, Chairman and Chief Executive Officer
- Consolidated revenue rebounded sharply in the first half of 2021, up 54.1% from the first half of 2020 and 8.4% higher than in the same period of 2019, on a comparable basis.
o In the second quarter of 2021, comparable revenue growth continued to accelerate, up 95.0% year on year and 11.2% versus the second quarter of 2019.
o In retail (including e-commerce), second-quarter comparable sales surged 97.9%, driven by North America (up 263%) and Asia-Pacific (up 53%).
- Recurring operating income was 2.3 times higher than in the first half of 2020, nearing the level achieved in the first half of 2019. The recurring operating margin rose by more than 10 points to 27.8%, fueled by the performance recovery at all Group Houses.
1 Recurring net income attributable to the Group: net income from continuing operations attributable to the Group, excluding non recurring items.
All Houses contributed to the Group’s strong performance
Total revenue of Kering’s Houses in the first half of 2021 amounted to €7,708.0 million, up 48.9% as reported and 53.3% on a comparable basis. Growth versus the first half of 2019 was particularly impressive, with comparable revenue up 7.7% and a marked acceleration in the second quarter, up 10.5%.
Sales generated in directly operated stores – which accounted for around 80% of the Houses' total sales in the first half of 2021 – were driven by the excellent momentum in North America and the Asia-Pacific region. Overall, comparable sales from the directly operated store network, including e-commerce, were 60.1% higher than in the first half of 2020 and up 11.2% from the first six months of 2019, even though an average of 17% and 13% of the store network remained closed during the first quarter and second quarter of 2021, respectively. The Houses’ outstanding online momentum continued, with e-commerce revenue up 78.5% year on year. E-commerce represented 14% of total retail sales in the first six months of 2021.
In the first half, wholesale revenue increased 29.8% year on year on a comparable basis. Comparable sales generated by this channel were down 4.0% in the past two years, reflecting the Houses’ strategy of streamlining their wholesale networks.
The Houses’ recurring operating income totaled €2,296.3 million in the first half of 2021. Recurring operating margin was 29.8%, up 9.3 points year on year, as the Houses pursue major investment programs to further reinforce their growth potential.
Gucci: growth momentum for the long term
Gucci posted first-half 2021 revenue of €4,479.3 million (up 45.8% as reported and 50.3% on a comparable basis), returning to its pre-pandemic level. Sales generated in directly operated stores – accounting for 91% of the House’s total revenue – were up 59.0% and 6.3% from the first six months of 2020 and 2019, respectively. The House continued to strengthen its positions with local customers.
In line with Gucci’s strategy to transform its distribution, implemented since early 2020, wholesale revenue was down 9.6%, and down 40.8% compared with 2019.
Gucci's sales growth accelerated significantly in the second quarter of 2021, with an increase of 86.1% on a comparable basis. Sales generated in directly operated stores rose 93.0% in the second quarter, representing an increase of 10.7% compared with the second quarter of 2019.
Gucci’s recurring operating income in the first six months of 2021 totaled €1,694.2 million. Recurring operating margin was 37.8%, as the House pursues its investments to broaden its brand influence, notably during this centenary year, and to further deploy its omnichannel clienteling activities.
Yves Saint Laurent: sharp rebound in sales and profitability
Yves Saint Laurent's sales amounted to €1,045.5 million in the first half of 2021, up 53.5% as reported and 58.2% on a comparable basis. Revenue from directly operated stores rose 74.9% year on year and was up 17.3% against 2019. Sales bounced back in all geographic regions, and particularly North America and Asia-Pacific, reflecting the ongoing success of both the House’s iconic lines and its new collections.
Wholesale revenue rose 25.4% during the period.
The House delivered an excellent performance in the second quarter, with revenue up 118.5% on a comparable basis. In the directly operated store network, sales were up 26.1% compared to the same period of 2019.
Recurring operating income totaled €275.1 million. Yves Saint Laurent continued to invest in its geographic expansion during the period while raising its recurring operating margin to 26.3%, which exceeded its pre-COVID level.
Bottega Veneta: very healthy growth across all distribution channels
Bottega Veneta generated revenue of €707.6 million in the first half of 2021, up 40.6% year on year as reported and 45.0% on a comparable basis. Sales in directly operated stores rose 45.2% compared with the first half of 2020 and 19.2% versus the same period of 2019, driven by very robust growth in North America in particular.
Wholesale revenue rose 44.6% year on year, as the House gains market share in its highly exclusive network of third-party retailers.
Bottega Veneta’s revenue in the second quarter of 2021 totaled a record €379.4 million, up 69.0%.
The House’s recurring operating income exceeded its first-half 2019 level and its recurring operating margin stood at 18.3%.
Other Houses: an excellent performance across the board
Revenue from the Group’s Other Houses rebounded sharply in the first half of 2021, at €1,475.6 million, up 60.5% as reported and 64.5% on a comparable basis. Comparable revenue in the first half of 2021 was 22.7% higher than in the first six months of 2019. Sales growth was very robust for all of the Other Houses’ distribution channels, reaching 63.1% for directly operated stores and 66.8% for the wholesale network.
Balenciaga and Alexander McQueen once again delivered outstanding performances, as did the Jewelry Houses. The Watchmaking brands and Brioni registered very encouraging rebounds.
Revenue growth of the Other Houses accelerated sharply in the second quarter, with sales up 111.3% on a comparable basis.
The Other Houses delivered recurring operating income of €197.3 million, up sharply year on year, and their recurring operating margin amounted to 13.4%, a 2.1-point improvement compared to the first half of 2019.
Corporate and other
Revenue of the Corporate and other segment increased 67.3% as reported and 72.7% on a comparable basis in the first half of 2021, fueled by the strong momentum of Kering Eyewear (up 61.8% on a comparable basis).
Kering Eyewear’s contribution to first-half consolidated revenue totaled €326.4 million (after elimination of intra-group sales and royalties paid to the Houses).
Net operating costs recorded by the Corporate and other segment totaled €59.3 million in the first half of 2021, a €51.3 million improvement compared to the first six months of 2020, thanks to sharply higher operating income at Kering Eyewear and tight control over corporate costs.
Financial result was €125.6 million negative, down 13.3% from €144.9 million last year. This total includes the cost of net debt, which amounted to €21.7 million, 27.7% lower than in the same period of 2020.
The effective tax rate in the first half of 2021 was 28.4% and its effective tax rate on recurring income was 28.2%.
Cash flow and financial position
The Group’s free cash flow from operations rose 316.2% year on year in the first half of 2021 to a record €2,353.9 million.
Kering’s financial structure at June 30, 2021 was very solid and its net debt was considerably reduced from the year-earlier level.
Though it remains highly dependent on developments in the health situation and associated restrictions across countries and regions, the luxury market has posted a significant rebound since the beginning of the year.
A key player in this market, Kering is perfectly positioned to fully benefit from the upturn, having successfully safeguarded its profitability while maintaining the expenditure and investments required to strengthen its Houses and ensure their potential to bounce back. Kering pursues the steadfast implementation of its strategy and will continue to steer and allocate its resources towards supporting its operating performance, maintain high cash flow generation, and optimize return on capital employed.
Thanks to its robust operational and organizational model, along with its solid financial position, Kering remains confident in its growth potential for the medium and long term.
At its meeting of July 27, 2021, Kering’s Board of Directors, under the chairmanship of François-Henri Pinault, approved the consolidated financial statements for the first half of 2021, which were subject to limited review procedures.
A global Luxury group, Kering manages the development of a series of renowned Houses in Fashion, Leather Goods, Jewelry and Watches: Gucci, Saint Laurent, Bottega Veneta, Balenciaga, Alexander McQueen, Brioni, Boucheron, Pomellato, DoDo, Qeelin, Ulysse Nardin, Girard-Perregaux, as well as Kering Eyewear. By placing creativity at the heart of its strategy, Kering enables its Houses to set new limits in terms of their creative expression while crafting tomorrow’s Luxury in a sustainable and responsible way. We capture these beliefs in our signature: “Empowering Imagination”. In 2020, Kering had over 38,000 employees and revenue of €13.1 billion.
Emilie Gargatte +33 (0)1 45 64 61 20 email@example.com
Marie de Montreynaud +33 (0)1 45 64 62 53 firstname.lastname@example.org
Claire Roblet +33 (0)1 45 64 61 49 email@example.com
Julien Brosillon +33 (0)1 45 64 62 30 firstname.lastname@example.org