Sugar-daddy doldrums

9 December 2002 By Camilla Palladino

The luxury goods group s shares are still defying gravity thanks to the PPR put. But the extent of PPR s potential liability is becoming clearer.

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Gucci has cut its forecasts for 2002 due to weak trading. The world's thirdlargest luxury goods maker said that diluted earnings per share would be a minimum of E2, compared to its previous guidance of E2.6. Gucci said that its sales would come in between E2.5bn and E2.6bn instead of the previously forecast E2.6bn – and that its operating margin would fall to 12% instead of 13%.

The group forecast that sales at its core Gucci Division would slip slightly, coming in between E1.5bn and E1.6bn, compared to the previously forecast E1.6bn. It also sees operating margins at the unit falling from 30% to 28%. The division, which makes readytowear, leather goods, shoes and jewellery, accounted for 62% of sales and 180% of ebita in the first half of the year.

Pinault PrintempsRedoute, which owns over 50% of Gucci, is committed to offer $101.5 for each of the remaining shares in March 2004.

Sugar-daddy doldrums

9 December 2002 By Camilla Palladino

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