Gucci posted a big drop in second-quarter and first-half earnings. Second-quarter net profit dropped to 22.7 million euros ($26.43 million) from 42.8 million a year ago, and even that figure was shored up by a timely tax credit of 23.5 million euros as well as financial and other income.

Group sales for the three months to end-July were only marginally higher at 583.7 million euros, while sales at the Gucci division actually fell slightly. Gucci has suffered like its peers from a decline in luxury goods spending due to a global economic downturn, the SARS epidemic and the war in Iraq. The industry is heavily dependent on tourism -- especially from the Japanese and Americans -- since tourists account for the majority of spending at flagship outlets. The Gucci group brands include Yves Saint Laurent, Stella McCartney and Alexander McQueen. The Amsterdam-listed firm is majority-owned by French department store operator Pinault-Printemps-Redoute. This company plans to increase its stake in Gucci to 70 percent by the end of this year and to buy out minority shareholders next year.