By Matthew Dalton
PARIS--The runaway success of Gucci shows little sign of slowing.
French luxury conglomerate Kering SA, which owns the Italian fashion brand, said Friday that 2016 net profit rose 17%, largely because of Gucci's performance. The brand's annual sales rose 13% to EUR4.38 billion ($4.68 billion); growth accelerated in the fourth quarter, when sales surged by 22%.
Saint Laurent, another of Kering's flagship brands, also delivered strong results, with annual sales rising 25% to EUR1.22 billion.
"We continue to gain market share, as witnessed by the spectacular performances of Gucci and Yves Saint Laurent last year," said François-Henri Pinault, the French billionaire who is Kering's chief executive and controlling shareholder.
The results reflect enduring momentum at Gucci under its creative director Alessandro Michele, who was named to the job in January 2015. Since then, Mr. Michele has revamped the brand, earning praise from critics and drawing droves of customers back to a mark that had fallen far out of fashion.
The full impact of Mr. Michele on Gucci's sales has yet to be felt: His designs are still being phased in to the brand's collections.
"This is an excellent performance for Gucci and Kering overall," Mario Ortelli, an analyst at Sanford C. Bernstein, wrote in a note to clients, adding that the brand's strong performance should continue as "Alessandro Michele-designed merchandise continues to be phased in and as the brand momentum continues to trickle from the fashion elite to the broader luxury consumer."
Kering's shares rose 2.3% in early trading, as the company's performance beat expectations.
The company said revenue for the year was EUR12.4 billion, up 6.9%. Sales growth accelerated in the fourth quarter, rising 10% to EUR3.5 billion.
Net profit for the year was EUR814 million.
Write to Matthew Dalton at Matthew.Dalton@wsj.com
(END) Dow Jones Newswires
February 10, 2017 04:48 ET (09:48 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.