PPR upbeat amid gathering gloom in European retail

By Marie Maitre and Rachel Sanderson

PARIS/LONDON (Reuters) - PPR's (PRTP.PA) Christmas sales were satisfactory, the French retailer said on Thursday, confirming it expected higher earnings for the full year despite worries the retail sector suffered a dismal Christmas.

The comments, from the owner of luxury goods group Gucci and department store Fnac, came after shares in European retailers sank following a profit warning from Europe's biggest electricals group DSG International (DSGI.L).

"Christmas sales were globally satisfactory and in line with our expectations," PPR Finance Director Jean-Francois Palus told Reuters, after PPR shares fell more than 5 percent following DSG's shock warning to their lowest level since August 2006.

Palus said its outlook included both retail and luxury goods sales at PPR, which also names Puma, Bottega Veneta and Yves Saint Laurent among its brands.

"We confirm that our earnings (in 2007) will improve compared with the previous year," Palus added.

The indication PPR enjoyed a merrier Christmas than some of its peers came during an otherwise gloomy day for retailers with more signs of consumers growing wary as the effects of the global credit crunch trickle down.

DSG shares slumped 26 percent after the owner of the Currys and PC World chains in Britain said its full-year pretax profit would miss analysts' forecasts, after slower-than-expected computer sales at Christmas and a weak performance at its Italian business UniEuro.

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