by Elisa Anzolin and Mimosa Spencer
MILAN/PARIS (Reuters) – Gucci’s new artistic director, Sabato de Sarno, presented a minimalist-inspired collection in Milan on Friday, with glamorous, bare lines, for a highly anticipated first show at the helm of the Italian house, flagship brand of the Kering group which hopes to breathe new life into it.
Models walked down a dark concrete runway at the brand’s Milan headquarters, a former aviation factory, showcasing short shorts paired with suit jackets, jewel-encrusted garments and tank tops with plunging necklines.
Sabato De Sarno “knows what we need right now, clean, luxurious sportswear that’s not brazenly sexy,” fashion critic Kenneth Richard, editor-in-chief of trade publication The Impression, told Reuters.
This parade was supposed to embody an aesthetic renewal for the French group’s brand, essential to create enthusiasm and revive sales, even if the new models will not arrive in stores before the start of next year.
With Gucci accounting for the majority of Kering’s sales and profits, the group hopes the new designer’s debut will boost its sales.
First collections can receive mixed reactions and even positive press reviews are not always an indicator of their future commercial success. However, the fashion show will “certainly have an impact on investors’ perception of De Sarno’s ability to trigger a shift in Gucci’s aesthetic,” said Antoine Belge, an analyst at Exane BNP Paribas.
On the Paris Stock Exchange, Kering shares closed up 1.51% at 460.45 euros, after gaining up to 5.07% during the parade, while the CAC 40 lost 0.4%. .
At current prices, Kering shares trade at around 14 times forecast earnings for the next 12 months, according to LSEG data. This ratio can be compared to 42 for Hermès or 22 for Moncler, two of its competitors.
“The climax is not right away – sometimes it’s the second or third show that is the most important,” François-Henri Pinault, Kering’s chairman and CEO, told reporters before the start of the show. the event, before greeting actor Ryan Gosling, guest in the front row.
In the run-up to the debut of Sabato De Sarno, in office since last May, Gucci has focused on timeless fashion and high-priced products while strengthening marketing and the number of collections.
“We believe the quiet progress made on product, pricing and marketing provides a solid foundation for Sabato De Sarno’s new chapter at the helm of the brand,” RBC analysts said.
Analysts say Kering may need to invest more to catch up with rivals like LVMH and Hermès, which could lead to a revision of margin forecasts.
“It now becomes very important that the new Gucci team scores points, to give investors confidence that we are indeed on the right track,” underlines Luca Solca, analyst at Bernstein.
Kering Deputy CEO Jean-François Palus now takes over as CEO of Gucci while the group seeks a more permanent replacement for CEO Marco Bizzarri, who is expected to leave the company after the show, as announced in July.
Marco Bizzarri and Gucci’s previous artistic director, Alessandro Michele, together led the spectacular turnaround of the brand, whose sales doubled between 2015 and 2019 to reach almost 10 billion euros.
However, the brand has lost ground to its rivals, who have invested heavily in marketing during the COVID-19 pandemic.
(Report by Mimosa Spencer and Elisa Anzolin; French version Diana Mandiá and Gaëlle Sheehan, edited by Blandine Hénault)
©2023 Thomson Reuters, all rights reserved. Reuters content is the intellectual property of Thomson Reuters or its third party content providers. Any copying, republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. “Reuters” and the Reuters Logo are trademarks of Thomson Reuters and its affiliated companies.