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Retail

Kering's Gucci posts forecast-beating rebound in fourth quarter

PARIS (Reuters) - Italian luxury brand Gucci reported a forecast-beating rebound in sales in the fourth quarter under its new designer and chief executive, helped by solid growth in Western Europe and Japan.

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Parent Kering PRTP.PA said Gucci's comparable sales rose 5 percent in the last three months of 2015, above market expectations of 2-3 percent.

French luxury and sports brand group Kering said Creative Director Alessandro Michele’s new collections, which were rolled out in stores in the autumn and brought a more romantic, vintage style, had been well received by critics and buyers.

“Kering (has beaten) top-line growth estimates and (this) shows that Gucci’s management is both expedient and on the right track,” Exane BNP Paribas analyst Luca Solca said.

“Gucci has come in with a significant number of new styles that are starting to turn heads - at the same time, it is benefiting from promotions on its former collections, in a repeat of the second-quarter pattern.”

Gucci, which has been led by CEO Marco Bizzarri for over a year now, has completed the renovation of many of its flagship stores.

However, Kering said it would slow the pace of store openings in 2016, which will help preserve the exclusivity of Gucci and other luxury brands within the group, such as Bottega Veneta and Balenciaga.

Kering said it made a recurring operating profit of 1.646 billion euros ($1.83 billion), down 1 percent, on revenue of 11.584 billion euros, up 15.4 percent, in 2015.

The company proposed keeping its dividend unchanged at 4 euros a share.

($1 = 0.9001 euros)

Editing by James Regan

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