Kering is reshuffling the cards at Gucci and at the head of the group to do better

The luxury group Kering announced on Tuesday a major reshuffle at the head of the group and its main brand Gucci, with the aim of “putting Kering on the path to success and long-term profitable growth”, in the words of its CEO François-Henri Pinault.

The CEO of Gucci since 2015, Marco Bizzarri, craftsman for years with the artistic director Alessandro Michele – left in November – of the return of Gucci to the front of the stage, will leave the group on September 23, announced Kering in a press release published on Tuesday.

He will be replaced “for a transitional period” by one of Mr. Pinault’s closest collaborators, Jean-François Palus, Deputy CEO of Kering.

Gucci, which represents more than half of Kering’s 20.35 billion turnover, is in difficulty against other major competitors in the sector, Louis Vuitton in the lead (LVMH group). While luxury has been running at full speed for many years, with insolent double-digit growth for many major brands, that of Gucci was “only” 8% in 2022, and even less in the fourth quarter.

“Gucci is obviously our priority because it is our greatest asset” but “the brand has not achieved the best performance lately”, admitted François-Henri Pinault during the presentation in February of the 2022 annual results, saying to himself ” determined” to put it “back on track”.

“For several decades, Jean-François has been, on a daily basis, my right arm and my teammate,” said Mr. Pinault on Tuesday, quoted in the Kering press release. “He will now devote all his energy to fortifying our main asset, and I am immensely grateful to him for that.”

Mr. Palus will resign as a director of Kering and will move to Milan, Kering said.

– “Kering is in transition” –

“Kering is in transition as the relaunch of its mega-brand Gucci is still underway,” Bernstein analyst Luca Solca said in a note on Tuesday.

“The departure of Marco Bizzarri seems timely to give full visibility to the +new chapter+ (wanted by Kering, just before the first fashion show of the new creative director Sabato De Sarno in Milan) and is not totally unexpected”, according to him.

“It becomes even more important that the new Gucci team scores goals and wins games, to give investors confidence that we are indeed on the right track”, adds the analyst, who had welcomed the departure of Alessandro. Michelle.

Two months after this departure, Gucci had recruited Sabato De Sarno, passed by Valentino.

“It is not surprising that the departure of Alexandro Michele corresponds to the arrival of a new CEO,” said a source close to the sector to AFP. “They were the driving forces and the thinkers behind Gucci’s return to the forefront,” adds this source, betting on “greater synergy” if the duo is entirely renewed.

Other important governance changes were announced Tuesday by Kering.

Francesca Bellettini, CEO of Yves Saint Laurent, at the Elysee Palace, July 5, 2021 (AFP/Archives – Ludovic MARIN)

Francesca Bellettini, building on her success as CEO of Yves Saint Laurent since 2013, becomes the group’s Deputy Managing Director, in charge of House Development. The CEOs of all the brands will report to her, and she will be responsible for “steering all of the group’s houses in the next stages of their development”.

The one who remains CEO of Yves Saint Laurent has “multiplied by six the turnover” of the brand since she took the reins, underlined François-Henri Pinault. “Saint Laurent is on the right track to reach 5 billion” in sales in the medium term, he assured in February.

Kering’s chief financial officer since 2012, Jean-Marc Duplaix, becomes the group’s deputy managing director in charge of operations and finance.

Thus, “we are building a more solid organization to fully capture the growth of the global luxury market,” said François-Henri Pinault.

In 2022, Kering achieved a turnover of 20.4 billion euros and a net profit of 3.6 billion euros, up 15% and 14% respectively.

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