Kering

Kering S.A.
Formerly
 Pinault S.A.
Pinault-Printemps-Redoute
PPR
Société Anonyme
Traded as Euronext: KER
CAC 40 Component
Industry Luxury
Founded 1963 (1963)
Founder François Pinault
Headquarters 40 rue de Sèvres, Paris 7e, France
Key people
 François-Henri Pinault
(Chairman and CEO)
Products Luxury goods
Sporting goods
Revenue €15.478 billion (2017)
€2.948 billion (2017)
€1.786 billion (2017)
Total assets €25.577 billion (2017)
Total equity €12.626 billion (2017)
Number of employees
 44,000 (2017)
Subsidiaries
Website kering.com
Footnotes / references
2017 Annual results

Kering S.A. (French: [kɛːʁiŋ]) is an international luxury group based in Paris, France. It owns luxury goods brands, including Gucci, Yves Saint Laurent, Balenciaga, Alexander McQueen, Bottega Veneta, Boucheron and Brioni, Pomellato.

The company was founded in 1963. It was known as Pinault S.A. until 1994, as Pinault-Printemps-Redoute from 1994 to 2005, as PPR from 2005 to 2013, and became Kering in 2013. It has been quoted on Euronext Paris since 1988 and has been a constituent of the CAC 40 index since 1995. The company has been headed by François-Henri Pinault since 2005.

History

Building a retail empire with wood

In 1963, with a loan from his family and a bank, François Pinault opened the Établissements Pinault in Brittany (France) and specialized in timber trading. The company grew organically and through successful acquisitions. In 1988, Pinault S.A. was listed on the Paris Stock Exchange, multiplying the group’s financial power.

In 1989, it purchased 20% of CFAO, a French distribution conglomerate active throughout Africa. In 1990, Pinault S.A. and CFAO merged, and François Pinault became head of the newly formed group. This accelerated its acquisitions in the retail sector: Conforama (French furniture retailer) in 1991, Printemps (department stores in Paris) in 1992, which also owned 54% of La Redoute (French mail-order shopping retailer), and Fnac (French bookstore, multimedia and electronics retailer) in 1994. To align the group’s identity with its new activities, it was renamed Pinault-Printemps-Redoute (PPR) in 1994.

Offloading retail assets to invest in luxury

Former logo of the company, when it was known as PPR (Pinault-Printemps-Redoute)

In 1999, Pinault-Printemps-Redoute purchased a controlling 42% stake of the Gucci group for $3 billion.[1] Through the Gucci deal, Pinault-Printemps-Redoute also acquired the brand Yves Saint Laurent.[2][3] It confirmed this new strategy with its following acquisitions, which included the French high-jewelry house Boucheron (2000), the Italian leather goods maker Bottega Veneta, and the fashion house Balenciaga (2001). In 2001, Pinault-Printemps-Redoute also signed strategic partnerships with ex-Givenchy fashion designer Alexander McQueen and with Stella McCartney.[4]

With a new strategy for the group, Pinault-Printemps-Redoute offloaded its assets in the retail sector one after the other: Pinault Bois et Matériaux, upon which the whole group developed and grew, was acquired in 2003 by the British group Wolseley.[5]

In 2003, François Pinault handed over the helm of Artémis, the family holding company that controlled Pinault-Printemps-Redoute and other assets (Château Latour, Christie’s, etc.), to his son François-Henri. In 2004, Pinault-Printemps-Redoute acquired almost all of the remaining shares of the Gucci group to reach a 99.4% ownership of the Italian luxury company.[6] In 2005, François-Henri Pinault chose a hands-on approach to managing Pinault-Printemps-Redoute and decided to take over the position of CEO.[7] The group officially changed its name to PPR.

The divestment of the group’s retail assets continued: Le Printemps (2006),[8] Conforama (2011), CFAO and Fnac (2012), and La Redoute (2013). In the meantime, PPR acquired the Sowind Group (owner of Swiss high-end watchmaker Girard-Perregaux) and the Italian bespoke tailor Brioni (2011),[9] the Italian group Pomellato (Pomellato and Dodo jewelry brands),[10] the Chinese jeweler Qeelin (2012),[11] the fashion designer Christopher Kane,[12] and luxury watch manufacturer Ulysse Nardin (2014).[13]

PPR also developed a Sport & Lifestyle portfolio with the acquisition of Puma in 2007,[7] Cobra Golf in 2010,[14] and Volcom in 2011.[15]

Kering, a new luxury company

The company's head office in Paris at 40 rue de Sèvres, formerly the Hôpital Laennec

On March 22, 2013, PPR changed its name to Kering in order to fully achieve the group’s shift towards luxury goods. Pronounced [kɛːʁiŋ], to sound like the English word "caring", the new name is a reference to the Pinault family’s region of origin, Brittany, where kêr means "home". The new logo has an owl as its emblem, a bird that can rotate its head 270 degrees, giving it extraordinary vision, and François Pinault’s favorite animal.[16][17]

In December 2014, Alessandro Michele, an unknown accessories designer, was named creative director of Gucci, and quickly revitalized the brand’s creativity, fashion relevance, and profitability.[18][19] From 2014 to 2017, Gucci's sales doubled from 3,497.2 million euros to 6,211.2 million euros.[20]

In 2015, following Hedi Slimane’s four-year success at the creative helm of Yves Saint Laurent, Kering named a new creative director, Anthony Vaccarello, to pursue the evolution of the brand while maintaining its growth pace.[21] In October 2015, Kering named Georgian-born designer Demna Gvasalia as creative director of Balenciaga, quickly turning the house into a performing brand on the fashion scene.[22]

In March 2018, Kering announced it has agreed to sell its shares of Stella McCartney to its eponymous owner.[23] In April 2018, Kering announced its intention to sell the sportswear company Volcom.[24] In May 2018, Kering also offloaded its shares of Puma, retaining a minor 15.7%, thus becoming a pure player in luxury.[25]

Description

Kering is an international luxury goods group based in Paris, France. Its portfolio includes brands specialized in the design, the making and the sale of fine products, especially in the leather-goods, shoes, ready-to-wear, watches and jewelry sectors:[26]

BrandWith Kering sinceCountry
Gucci1999Italy
Saint Laurent1999France
Boucheron2000France
Bottega Veneta2001Italy
Balenciaga2001Spain
Alexander McQueen2001UK
Brioni2011Italy
Girard-Perregaux2011Switzerland
JeanRichard2011Switzerland
Qeelin2012France
Pomellato2012Italy
Dodo2012Italy
Tomas Maier2013Germany
Christopher Kane2014UK
Ulysse Nardin2014Switzerland
Volcom2011USA

Commitments

Sustainability

In April 2012, Kering committed to a 4-year plan aiming to significantly reducing its impact on the environment. The group defined a set of quantifiable targets covering both environmental and social issues, and developed the Environmental Profit & Loss account (E P&L) to measure its progress.[27]

In September 2013, Kering became part of the Dow Jones Sustainability Indices world and Europe, and was recognized as an industry leader in 2014 and 2015.[28]

Published in 2016, Kering’s sustainability report showed that Kering was able to control some supply/production chains more than others: while it reached 99% on its PVC-free goal, it only reached 15% on its goal to purchase its gold from verified "fairmined gold" providers, and 64% of its goal to purchase its leather from responsible and verified sources. Carbon emissions were reduced by 11%, waste output by 16% and water usage by 19%. 6,000 supplier audits were performed.[27] Kering then announced its new sustainability program, which targets a 40% reduction of its global environmental impact by 2025, a strategy aligned with the UN Sustainable Development Goals.[29][30]

In January 2018, during the World Economic Forum in Davos, Kering was named top sustainable textile, apparel and luxury goods corporation in the Corporate Knights Global 100 index.[31] In February 2018, in partnership with the London College of Fashion, Kering launched the first online class (Mooc) in fashion and sustainability.[32]

Kering Foundation

The Kering Foundation is committed to defending women’s dignity and rights by combating violence against women and promoting women’s empowerment. Since 2009, the Foundation initiated 47 partnerships with NGOs and supported many social projects oriented towards women’s rights.

Many brands have their own philanthropic projects with the support of the Kering Foundation. Gucci launched its project Chime for Change, an international campaign to raise funds for women’s emancipation, focusing on education, health and justice.[33]

Every year since 2012, the Kering Foundation has contributed to the International Day for the Elimination of Violence against Women with the White Ribbon for Women campaign.[34]

Women In Motion Awards

In 2015, Kering became an official partner of the Cannes Film Festival and launched Women in Motion to highlight the contribution of women to the film industry, both in front of and behind the camera. The program is based on talks where personalities share their recommendations for the advancement of women’s representation in the industry. The Women in Motion Awards have been awarded annually to an inspirational figure who embodies the role of women in the film industry, and another to a promising name in cinema.[35] Past winners include:

Governance

Board of Directors

  • François-Henri Pinault - Chairman and CEO
  • Jean-François Palus - Group Managing Director
  • Patricia Barbizet- Vice-Chair of the Board of Directors
  • Laurence Boone - Independent director
  • Sophie Bouchillou - Director representing employees
  • Yseulys Costes - Independent director
  • Jean-Pierre Denis - Independent director
  • Sophie L'Hélias - Independent director
  • Baudouin Prot - Director
  • Daniel Ricardi - Independent director
  • Sapna Sood - Independent director

Executive Committee

  • François-Henri Pinault - Chairman and CEO
  • Jean-François Palus - Group Managing Director
  • Jean-Philippe Bailly - COO
  • Francesca Bellettini - President and CEO of Saint Laurent
  • Albert Bensoussan - CEO Luxury Watches and Jewelry
  • Marco Bizzarri - CEO Gucci
  • Grégory Boutté : Chief Client and Digital Officer
  • Marie-Claire Daveu - Chief Sustainability Officer and Head of institutional affairs
  • Valérie Duport - Chief Communications and Image Officer
  • Jean-Marc Duplaix - CFO
  • Claus-Dietrich Lahrs - President and CEO Bottega Veneta
  • Béatrice Lazat - VP Human Resources
  • Roberto Vedovotto - CEO Kering Eyewear

Financial results

Results

Financial data in euro millions
Year 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Sales 17 931 17 761 20 201 16 525 11 008 12 227 9 736 9 748 10 037 11 584 12 385 15 478
EBITDA 1 540 2 096 2 140 1 790 1 649 1 911 2 067 1 750 1 647 1 886 2 948
Net results 680 1 058 924 985 965 986 1 048 50 528.9 696 814 1 786
Net debt 3 461 6 121 5 510 4 367 4 000 3 395 2 491 3 443 4 679 4 371 3 049

Market data

Years 2007 2008 2009 2010 2011 2012 2016 2017
Number of shares (in millions) 128 128.4 126.5 126.8 127 126.2 126.2 126.3
Market capitalizations (in millions of Euros) 14089 5897 10 661 15 093 14 034 17 764 26,935 49 628
Number of daily transactions 692 022 1 116 420 701 105 453 415 385 265 317 960
  • Date of IPO: 25 October 1988, Second Marché
  • Shares listed on the Bourse de Paris
  • Member of the CAC 40 index since 9 February 1995
  • Nominal value = euro
  • Main shareholders: Artémis 40.8%

Controversies

Possible tax evasion

In Novembre 2017 Italian authorities opened a criminal investigation into a tax case involving Kering and its flagship brand Gucci. The inquiry included a raid on Gucci offices in Florence and Milan. The authorities were looking into whether Gucci should have paid as much as 1.3 billion Euro in past domestic taxes.[38]

Including France and UK, the amount of possible tax evasion by Kering is considered to be up to 2.5 billion Euros.[39]

See also

References

  1. ↑ "Gucci fades on court ruling". Cnn.com. 27 May 1999. Retrieved 24 July 2017.
  2. ↑ "Gucci Group Agrees to Sell 40% Stake to French Retailer". Latimes.com. 20 March 1999. Retrieved 24 July 2017.
  3. ↑ Sri Ramakrishnan (16 November 1999). "Gucci to Buy Parent Of Yves Saint Laurent". Washingtonpost.com. Retrieved 24 July 2017.
  4. ↑ McNeil, Peter; Riello, Giorgio (19 May 2016). Luxury: A Rich History. Oxford University Press. p. 256. ISBN 9780191640278.
  5. ↑ Joanne Wallen (24 April 2003). "Ooh la la, Wolseley gets heavy in France". Citywire.co.uk. Retrieved 24 July 2017.
  6. ↑ Suzanne Kapner (23 March 2004). "PPR moves to buy last 30% of Gucci Group". Nypost.com. Retrieved 24 July 2017.
  7. 1 2 Joshua Levine (15 February 2013). "The Man Behind the Curtain". Nytimes.com. Retrieved 24 July 2017.
  8. ↑ Sara Gay Forden, Jacqueline Simmons (20 June 2006). "As sales fall, PPR works to unload Printemps". Nytimes.com. Retrieved 24 July 2017.
  9. ↑ Christina Passariello (8 November 2011). "PPR Buys Menswear Brand Brioni". Wsj.com. Retrieved 24 December 2013.
  10. ↑ Luisa Zargani, Miles Socha (24 April 2013). "Kering Acquires Pomellato". Wwd.com. Retrieved 24 July 2017.
  11. ↑ "PPR acquires majority stake in Chinese Qeelin". Fashiounited.com. 9 December 2012. Retrieved 24 July 2017.
  12. ↑ Ella Alexander (15 January 2013). "PPR Buys Majority Stake In Christopher Kane". Vogue.co.uk. Retrieved 24 July 2017.
  13. ↑ Elizabeth Doerr (30 July 2014). "Kering (Previously PPR, Gucci Group) Acquires Ulysse Nardin". Forbes.com. Retrieved 24 July 2017.
  14. ↑ "Puma acquires Cobra Golf and announces becoming Cobra-Puma Golf". Worldgolf.com. 10 May 2010. Retrieved 24 July 2017.
  15. ↑ Chris V. Nicholson (2 May 2011). "PPR to Buy Volcom, a Sportswear Maker". Nytimes.com. Retrieved 24 July 2017.
  16. ↑ "PPR becomes Kering". Kering.com. 22 March 2013. Retrieved 24 July 2017.
  17. ↑ Anthony DeMarco (18 June 2013). "It's Official: PPR Becomes Kering; Reportedly In Talks To Acquire Richard Mille". Forbes.com. Retrieved 24 July 2017.
  18. ↑ Harriet Agnew (10 February 2017). "Kering reports strongest revenue growth since 2012". Ft.com. Retrieved 24 July 2017.
  19. ↑ Robert William (26 April 2017). "Gucci's Latest Revival Fueled by Sequins Rather Than Sex". Bloomberg.com. Retrieved 24 July 2017.
  20. ↑ Limei Hoang (27 October 2016). "Marco Bizzarri on Gucci's Remarkable Turnaround". Businessoffashion.com. Retrieved 20 June 2018.
  21. ↑ Maura Brannigan (10 February 2017). "10 months after Hedi Slimane's departure, Yves Saint Laurent is still Kering's big money-maker". Fashionista.com. Retrieved 24 July 2017.
  22. ↑ Jess Cartner-Morley (2 October 2016). "Demna Gvasalia reinvigorates Balenciaga with strategic disrespect". Theguardian.com. Retrieved 24 July 2017.
  23. ↑ Ben Stevens (29 March 2018). "Kering offloads entire stake in Stella McCartney". Retailgazette.co.uk. Retrieved 19 June 2018.
  24. ↑ "Kering to Sell Volcom". Businessoffashion.com. 6 April 2018. Retrieved 20 June 2018.
  25. ↑ Beth Wright (16 May 2018). "Kering officially spins off Puma". Just-style.com. Retrieved 19 June 2018.
  26. ↑ "Recurring operating income breakdown by activity (2016)". Kering.com. Retrieved 24 July 2017.
  27. 1 2 Kate Abnett (3 May 2016). "Kering Goes Public with Sustainability Report, Revealing Progress and Pain Points". Businessoffashion.com. Retrieved 24 July 2017.
  28. ↑ Monica Karski (17 September 2015). "Kering still industry leader in Dow Jones Sustainability Indices". Fashionnetwork.com. Retrieved 24 July 2017.
  29. ↑ Elizabeth Paton (25 January 2017). "François-Henri Pinault, Kering Chief, on Why Green Is the New Black". Nytimes.com. Retrieved 24 July 2017.
  30. ↑ Libby MacCarthy (26 January 2017). "Kering to Transform Luxury Industry with Next-Gen Sustainability Strategy". Sustainablebrands.com. Retrieved 24 July 2017.
  31. ↑ Lorelei Marfil (23 January 2018). "Kering Named Most Sustainable Global Corporation". Wwd.com. Retrieved 20 June 2018.
  32. ↑ Sarah Karmali (20 February 2018). "Kering launches first online course in luxury fashion and sustainability". Harpersbazaar.com. Retrieved 20 June 2018.
  33. ↑ "Chime For Change Campaign, Beyoncé Launch Initiative To Help Girls Run The World". huffingtonpost.com. 2013-01-03. Retrieved 2013-01-03.
  34. ↑ Josh Lee (18 November 2016). "Why you should support the White Ribbon campaign". Gq-magazine.co.uk. Retrieved 24 July 2017.
  35. ↑ "Women in Motion - Cannes International Film Festival". Businessoffashion.com. Retrieved 20 June 2018.
  36. ↑ "Kering & The Festival De Cannes Will Present The 2017 Women in Motion Award to Isabelle Huppert". Ikon London Magazine. 5 May 2017. Retrieved 23 February 2018.
  37. ↑ Stewart Clarke (4 May 2018). "'Wonder Woman' Director Patty Jenkins to Receive 2018 Women in Motion Award". Variety.com. Retrieved 20 June 2018.
  38. ↑ "kering-gucci-tax-investigation". nytimes.com. 16 March 2018. Retrieved 13 October 2018.
  39. ↑ "le-groupe-francais-de-luxe-kering-aurait-soustrait-2-5-milliards-d-euros-d-impots-selon-mediapart". lemonde.fr. 21 March 2018. Retrieved 13 October 2018.
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