Balenciaga turns a profit

Luxury fashion brand Balenciaga has reached profitability two years before its target date. According to WWD the brand, which is owned by Gucci Group, achieved triple-digit sales growth across the board, surpassing all expectations. "We went from being a niche brand to now a future big band," said the brand's designer Nicolas Ghesquière to WWD. "The whole perception of the brand is changing. Balenciaga is starting to define a new kind of luxury house."

Having achieved its target far ahead of schedule, the Gucci Group is now investing more in Balenciaga's growth and development. "This is a business that has the potential to do about EUR200 million," Balenciaga chief executive James McArthur told WWD. McArthur is also executive vice president and director of strategy and acquisition for the Gucci Group, and also overseas Alexander McQueen and Stella McCartney.

McArthur did not disclose sales figures. Gucci Group parent PPR is due to report its 2005 earnings on 9 March. However, he did emphasize that the triple-digit growth applied to all categories, including ready-to-wear. Balenciaga's sales volume is believed to exceed EUR60 million, more than triple its revenue in 2001 when it was bought by Gucci Group.