Latest news with #François-HenriPinault
Fashion United
16 hours ago
- Business
- Fashion United
Is François-Henri Pinault stepping back from Kering?
Paris - 63-year-old François-Henri Pinault, chief executive officer of French luxury group Kering (Kering), is reportedly planning to separate the roles of chairman and chief executive officer. This information was published on Thursday by the business magazine Challenges. According to the magazine, which did not cite its sources, Pinault will remain chairman, while executive search firm Jouve has been tasked with finding a new chief executive officer. Two internal candidates have been identified: Francesca Bellettini and Jean-Marc Duplaix, both deputy chief executive officers. Challenges added that an external appointment remains a possibility. Kering declined to comment when contacted. Pinault has been chief executive officer since 2005, taking over from his father, François Pinault. The group was originally called PPR (Pinault-Printemps-Redoute) before being renamed Kering in 2013. Kering's sales, still affected by the performance of its flagship brand Gucci, continued to decline in the first quarter of 2025, reaching 3.88 billion euros (down 14 percent). This followed a 62 percent drop in net profit and a 12 percent fall in revenue in 2024. Since January 1, Kering's share price has fallen by over 25 percent.(AFP) This article was translated to English using an AI tool. FashionUnited uses AI language tools to speed up translating (news) articles and proofread the translations to improve the end result. This saves our human journalists time they can spend doing research and writing original articles. Articles translated with the help of AI are checked and edited by a human desk editor prior to going online. If you have questions or comments about this process email us at info@
Miami Herald
7 days ago
- Business
- Miami Herald
Gucci, YSL owner sends blunt message about tariff threats
I bought my first pair of Saint Laurent (YSL) heels when I was 25. They were all black patent leather in the iconic Tribute style, with crisscross straps and a sky-high platform that made absolutely no sense and every kind of sense at the same time. I can't remember exactly why, but I had some reason to celebrate (or so I told myself), and I couldn't resist the rush of slipping those shoes on in the YSL store at Copley in Boston. They were bold. A little aggressive. And completely, unapologetically French. Related: Popular luxury brand takes a massive leap of faith in risky move That moment wasn't just about fashion - it was about owning something that felt like power. Putting them on was like flipping a switch: confidence, elegance, a little bit of edge. Luxury brands like YSL know exactly what they're selling. Sure, there's craftsmanship and quality, but really, it's culture. A story. An idea that something made in France or Italy is worth paying a premium. So when presidents start throwing around threats of tariffs and urging companies to move production closer to home, that idea gets tested. But Kering (PPRUY) , the company behind Gucci, YSL, and Bottega Veneta, just made it clear: it has no intention of budging. Image source: Sorbis/Shutterstock On the Q1 2025 earnings call, Kering CEO François-Henri Pinault made one thing clear: the company won't be moving its production out of Europe in response to U.S. tariffs. "Most of our brands we are producing in Italy and in France, and this is part of the promise that we bring through our products, through our heritage, to the consumer," he told investors. He went even further, adding, "We are selling part of our culture, being an Italian culture or a French culture. So we have no plan of producing to counter the tariff. It makes no sense." Related: Luxury outerwear brand avoids tariffs as rivals try to exit China His comments came just days after President Donald Trump signaled that sweeping new tariffs on goods from the European Union were imminent, calling the EU's trade actions "an atrocity." Pinault said the company already operates in large global markets (like China) where import duties are standard, and he emphasized that adjusting its entire supply chain would dilute the very value proposition luxury buyers are paying for. Still, Kering isn't ignoring the issue. Pinault acknowledged the company may have to rethink pricing strategy if the tariffs go into effect. Tariffs aren't the only problem on Kering's plate. In its latest results, the group reported a 14% drop in revenue for the first quarter of 2025, totaling €3.9 billion. Gucci continues to struggle. The brand brought in €1.6 billion in Q1 2025, down 24% year-over-year. Sales fell sharply across both its retail and wholesale channels. Meanwhile, YSL posted €679 million in Q1 revenue, down 8%, with some resilience in European and Middle Eastern markets. Kering closed 25 stores globally during the quarter, and although Bottega Veneta (up 4%) and its beauty and eyewear segments saw growth, the group's overall trajectory remains challenged. Pinault addressed the issue, stating, "We are increasing our vigilance to weather the macroeconomic headwinds our industry faces." The company also recently offloaded its stake in The Mall Luxury Outlets and entered a joint venture for three Parisian real estate assets, moves that signal a tighter focus on its core business and brand strategy. Kering's message - heritage over haste - is one not all luxury players may be able to afford. But if it pulls through, it'll be because it stood by elegance, even when tariffs made shortcuts tempting. Related: Versace, Michael Kors, Jimmy Choo stumble hard The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Fashion Network
29-05-2025
- Business
- Fashion Network
Kering's debt burden grows as Gucci strategy falters
In an effort to reduce Kering 's overreliance on its struggling flagship label Gucci, French billionaire François-Henri Pinault may have triggered a new crisis. A series of acquisitions has significantly increased the group's debt load just as the luxury industry enters a prolonged downturn. Managing that debt has become increasingly difficult. Kering shares have dropped 60% over the past two years, and the threat of tariffs from former U.S. President Donald Trump has dampened hopes for a sector recovery. These challenges are weighing heavily on Kering as it competes with deep-pocketed luxury rivals. Pinault's family, which holds Artemis —which controls Kering and holds a stake in sports brand Puma —is also burdened by debt. It may need to repay €500 million ($567 million) in cash to investors following the cut-off date for a convertible bond, triggered by Puma's underperformance. Kering could also face additional financial pressure as early as next year if it is required to buy out the remaining stake in fashion house Valentino. Although the company is cutting costs and selling off real estate, bondholders told Reuters that if its financial position doesn't improve, it risks receiving a third credit rating downgrade in as many years. They declined to be named due to confidentiality. Another downgrade would make it even harder for Kering to revive Gucci and compete with debt-free powerhouses like Hermès, Chanel and LVMH —all of which are investing heavily in their brands. 'This is the worst of times because sales are falling, profits are down, and interest rates are rising. They can't even renegotiate their debt,' said Eric Pichet, an economics professor at France's Kedge Business School. Kering declined to comment for this article. Pinault, who became CEO of Kering in 2005 after taking over from his father François, enjoyed years of explosive growth driven by Gucci and the 'ugly-chic' aesthetic of former creative director Alessandro Michele. However, consumer interest in Michele's fur-lined loafers and eclectic style faded after the pandemic. Pinault responded by diversifying the business through acquisitions. Kering took a 30% stake in Valentino, acquired luxury perfume brand Creed, invested in prime real estate, and—via Artemis—purchased a controlling stake in a Hollywood talent agency. As a result, Kering's net debt surged to €10.5 billion by the end of 2024, up from virtually nothing in 2021. That debt now represents half the company's market value. Meanwhile, Artemis's debt is even higher, according to recent filings. Shopping spree A source who advised Pinault and Kering executives said the group struggled post-pandemic to decide whether Gucci should focus on bold fashion or return to more classical designs. As Gucci's sales declined, Pinault moved aggressively. In 2023, Kering paid €3.5 billion for Creed and $1.9 billion in cash for 30% of Valentino. Within two years, Kering also spent approximately €4 billion acquiring prime retail properties in New York, Milan and Paris. An insider said Kering paid substantial premiums to outbid rivals, fearing that its brands—including Yves Saint Laurent and Balenciaga —could lose access to top-tier locations. With free cash flow down nearly 30% in 2024 to €1.4 billion, Kering is now selling stakes in these properties. According to remarks made to analysts in February, the group aims to raise €2 billion in cash by 2026. However, these sales may not reach their book value. Kering's 2024 annual report shows a €100 million charge on the sale of a 60% stake in three Paris properties. Other pressures are mounting. Kering previously stated it would acquire Valentino outright by 2028 from Mayhoola, a Qatari royal-backed investment fund. However, putting options in the agreement could force Kering to buy the remaining 70% as early as May 2026. Depending on Valentino's performance, this could require an additional €4 billion. In April, Kering said its cost-cutting plan—which includes store closures and layoffs—could allow it to finance an early buyout if needed. The company also noted that it could use up to 3 million Kering shares, or 2.4% of its equity, to pay part of the acquisition price. According to a source close to Mayhoola, the fund would welcome a stake in Kering as part of its broader investment strategy. Still, based on Kering's current market value, a share-based transaction would only cover a small portion of the total cost. Downgrade risk S&P told Reuters that Kering's adjusted net debt—including lease obligations—stood at 3.8 times core earnings (EBITDA) by the end of 2024. While S&P declined to comment on the timing of any potential downgrade, the trend is concerning. UBS analysts recently estimated that Kering's leverage ratio could hit 4.1 by the end of 2025. One bondholder noted that breaching the 4.0 mark often signals an increased risk of a credit downgrade. Replicating his acquisition strategy at the family level, the 63-year-old Pinault used Artemis to acquire a 53% stake in talent agency CAA for €3.5 billion, according to filings. At the end of 2023, the most recent filings show that Artemis's total net debt—including Kering's—stood at €20.2 billion, more than double the previous year. While Kering could theoretically cut its dividend to conserve cash, such a move would likely worsen liquidity issues at Artemis, which depends on dividend inflows. ($1 = €0.8813)
Fashion Network
29-05-2025
- Business
- Fashion Network
Kering's debt burden grows as Gucci strategy falters
In an effort to reduce Kering 's overreliance on its struggling flagship label Gucci, French billionaire François-Henri Pinault may have triggered a new crisis. A series of acquisitions has significantly increased the group's debt load just as the luxury industry enters a prolonged downturn. Managing that debt has become increasingly difficult. Kering shares have dropped 60% over the past two years, and the threat of tariffs from former U.S. President Donald Trump has dampened hopes for a sector recovery. These challenges are weighing heavily on Kering as it competes with deep-pocketed luxury rivals. Pinault's family, which holds Artemis —which controls Kering and holds a stake in sports brand Puma —is also burdened by debt. It may need to repay €500 million ($567 million) in cash to investors following the cut-off date for a convertible bond, triggered by Puma's underperformance. Kering could also face additional financial pressure as early as next year if it is required to buy out the remaining stake in fashion house Valentino. Although the company is cutting costs and selling off real estate, bondholders told Reuters that if its financial position doesn't improve, it risks receiving a third credit rating downgrade in as many years. They declined to be named due to confidentiality. Another downgrade would make it even harder for Kering to revive Gucci and compete with debt-free powerhouses like Hermès, Chanel and LVMH —all of which are investing heavily in their brands. 'This is the worst of times because sales are falling, profits are down, and interest rates are rising. They can't even renegotiate their debt,' said Eric Pichet, an economics professor at France's Kedge Business School. Kering declined to comment for this article. Pinault, who became CEO of Kering in 2005 after taking over from his father François, enjoyed years of explosive growth driven by Gucci and the 'ugly-chic' aesthetic of former creative director Alessandro Michele. However, consumer interest in Michele's fur-lined loafers and eclectic style faded after the pandemic. Pinault responded by diversifying the business through acquisitions. Kering took a 30% stake in Valentino, acquired luxury perfume brand Creed, invested in prime real estate, and—via Artemis—purchased a controlling stake in a Hollywood talent agency. As a result, Kering's net debt surged to €10.5 billion by the end of 2024, up from virtually nothing in 2021. That debt now represents half the company's market value. Meanwhile, Artemis's debt is even higher, according to recent filings. Shopping spree A source who advised Pinault and Kering executives said the group struggled post-pandemic to decide whether Gucci should focus on bold fashion or return to more classical designs. As Gucci's sales declined, Pinault moved aggressively. In 2023, Kering paid €3.5 billion for Creed and $1.9 billion in cash for 30% of Valentino. Within two years, Kering also spent approximately €4 billion acquiring prime retail properties in New York, Milan and Paris. An insider said Kering paid substantial premiums to outbid rivals, fearing that its brands—including Yves Saint Laurent and Balenciaga —could lose access to top-tier locations. With free cash flow down nearly 30% in 2024 to €1.4 billion, Kering is now selling stakes in these properties. According to remarks made to analysts in February, the group aims to raise €2 billion in cash by 2026. However, these sales may not reach their book value. Kering's 2024 annual report shows a €100 million charge on the sale of a 60% stake in three Paris properties. Other pressures are mounting. Kering previously stated it would acquire Valentino outright by 2028 from Mayhoola, a Qatari royal-backed investment fund. However, putting options in the agreement could force Kering to buy the remaining 70% as early as May 2026. Depending on Valentino's performance, this could require an additional €4 billion. In April, Kering said its cost-cutting plan—which includes store closures and layoffs—could allow it to finance an early buyout if needed. The company also noted that it could use up to 3 million Kering shares, or 2.4% of its equity, to pay part of the acquisition price. According to a source close to Mayhoola, the fund would welcome a stake in Kering as part of its broader investment strategy. Still, based on Kering's current market value, a share-based transaction would only cover a small portion of the total cost. Downgrade risk S&P told Reuters that Kering's adjusted net debt—including lease obligations—stood at 3.8 times core earnings (EBITDA) by the end of 2024. While S&P declined to comment on the timing of any potential downgrade, the trend is concerning. UBS analysts recently estimated that Kering's leverage ratio could hit 4.1 by the end of 2025. One bondholder noted that breaching the 4.0 mark often signals an increased risk of a credit downgrade. Replicating his acquisition strategy at the family level, the 63-year-old Pinault used Artemis to acquire a 53% stake in talent agency CAA for €3.5 billion, according to filings. At the end of 2023, the most recent filings show that Artemis's total net debt—including Kering's—stood at €20.2 billion, more than double the previous year. While Kering could theoretically cut its dividend to conserve cash, such a move would likely worsen liquidity issues at Artemis, which depends on dividend inflows. ($1 = €0.8813)
Fashion Network
28-05-2025
- Business
- Fashion Network
Kering's debt burden grows as Gucci strategy falters
In an effort to reduce Kering 's overreliance on its struggling flagship label Gucci, French billionaire François-Henri Pinault may have triggered a new crisis. A series of acquisitions has significantly increased the group's debt load just as the luxury industry enters a prolonged downturn. Managing that debt has become increasingly difficult. Kering shares have dropped 60% over the past two years, and the threat of tariffs from former U.S. President Donald Trump has dampened hopes for a sector recovery. These challenges are weighing heavily on Kering as it competes with deep-pocketed luxury rivals. Pinault's family, which holds Artemis —which controls Kering and holds a stake in sports brand Puma —is also burdened by debt. It may need to repay €500 million ($567 million) in cash to investors following the cut-off date for a convertible bond, triggered by Puma's underperformance. Kering could also face additional financial pressure as early as next year if it is required to buy out the remaining stake in fashion house Valentino. Although the company is cutting costs and selling off real estate, bondholders told Reuters that if its financial position doesn't improve, it risks receiving a third credit rating downgrade in as many years. They declined to be named due to confidentiality. Another downgrade would make it even harder for Kering to revive Gucci and compete with debt-free powerhouses like Hermès, Chanel and LVMH —all of which are investing heavily in their brands. 'This is the worst of times because sales are falling, profits are down, and interest rates are rising. They can't even renegotiate their debt,' said Eric Pichet, an economics professor at France's Kedge Business School. Kering declined to comment for this article. Pinault, who became CEO of Kering in 2005 after taking over from his father François, enjoyed years of explosive growth driven by Gucci and the 'ugly-chic' aesthetic of former creative director Alessandro Michele. However, consumer interest in Michele's fur-lined loafers and eclectic style faded after the pandemic. Pinault responded by diversifying the business through acquisitions. Kering took a 30% stake in Valentino, acquired luxury perfume brand Creed, invested in prime real estate, and—via Artemis—purchased a controlling stake in a Hollywood talent agency. As a result, Kering's net debt surged to €10.5 billion by the end of 2024, up from virtually nothing in 2021. That debt now represents half the company's market value. Meanwhile, Artemis's debt is even higher, according to recent filings. Shopping spree A source who advised Pinault and Kering executives said the group struggled post-pandemic to decide whether Gucci should focus on bold fashion or return to more classical designs. As Gucci's sales declined, Pinault moved aggressively. In 2023, Kering paid €3.5 billion for Creed and $1.9 billion in cash for 30% of Valentino. Within two years, Kering also spent approximately €4 billion acquiring prime retail properties in New York, Milan and Paris. An insider said Kering paid substantial premiums to outbid rivals, fearing that its brands—including Yves Saint Laurent and Balenciaga —could lose access to top-tier locations. With free cash flow down nearly 30% in 2024 to €1.4 billion, Kering is now selling stakes in these properties. According to remarks made to analysts in February, the group aims to raise €2 billion in cash by 2026. However, these sales may not reach their book value. Kering's 2024 annual report shows a €100 million charge on the sale of a 60% stake in three Paris properties. Other pressures are mounting. Kering previously stated it would acquire Valentino outright by 2028 from Mayhoola, a Qatari royal-backed investment fund. However, putting options in the agreement could force Kering to buy the remaining 70% as early as May 2026. Depending on Valentino's performance, this could require an additional €4 billion. In April, Kering said its cost-cutting plan—which includes store closures and layoffs—could allow it to finance an early buyout if needed. The company also noted that it could use up to 3 million Kering shares, or 2.4% of its equity, to pay part of the acquisition price. According to a source close to Mayhoola, the fund would welcome a stake in Kering as part of its broader investment strategy. Still, based on Kering's current market value, a share-based transaction would only cover a small portion of the total cost. Downgrade risk S&P told Reuters that Kering's adjusted net debt—including lease obligations—stood at 3.8 times core earnings (EBITDA) by the end of 2024. While S&P declined to comment on the timing of any potential downgrade, the trend is concerning. UBS analysts recently estimated that Kering's leverage ratio could hit 4.1 by the end of 2025. One bondholder noted that breaching the 4.0 mark often signals an increased risk of a credit downgrade. Replicating his acquisition strategy at the family level, the 63-year-old Pinault used Artemis to acquire a 53% stake in talent agency CAA for €3.5 billion, according to filings. At the end of 2023, the most recent filings show that Artemis's total net debt—including Kering's—stood at €20.2 billion, more than double the previous year. While Kering could theoretically cut its dividend to conserve cash, such a move would likely worsen liquidity issues at Artemis, which depends on dividend inflows. ($1 = €0.8813)
