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Strong declines, at the start of trading, for the luxury sector, starting with Kering. In Paris, the shares of the French giant led by François-Henri Pinault lost 13.86% and led the entire sector after last night’s profit warning, communicated after the markets were closed. The group announced a forecast of a decline in sales “of approximately 10%” in the first quarter of 2024, compared to the first quarter of last year.
A performance which, Kering explained, mainly reflects a more marked decline in Gucci’s sales, particularly in the Asia-Pacific region, which would lose 20% in the first quarter on an annual basis. The French giant will communicate the revenues for the first quarter of 2024 on April 23rd, after the markets close, but in the meantime the sector is in turmoil.
At Piazza Affari
On Piazza Affari, Brunello Cucinelli lost 2.08% at the start and Moncler scored -1.52%, after the Rivetti family, through its vehicle Grinta, sold 3.23 million Moncler shares at a discount compared to the last closing. Salvatore Ferragamo also trades negative at -2.64%.
The prospects
According to analysts at Citi, Kering could see a downward revision of consensus estimates, while the turnaround of its flagship brand Gucci could be slower than expected. Kering’s warning is a rather worrying sign for the luxury sector. Consensus earnings estimates had already been cut after Kering said it expected a decline in EBIT this year due to planned investments to reinvigorate Gucci and other brands, analysts said. Citi expects consensus EBIT and EPS for 2024 to be reduced by about 15% due to Gucci alone.