French retail group PPR SA, which manufactures Gucci handbags, has posted a 20% revenue increase to EUR17.9bn (US$23.5bn) for the 2006 annual year, which was described by the company as "very satisfying".

The retail and luxury group 's net profit rose 28% to EUR685m, with revenues outside France up 8.6% compared to 2005, accounting for 55% of the group's total sales.

François-Henri Pinault, chairman and CEO of PPR, said: "With a remarkable increase in net income, PPR once again demonstrates the efficiency of its business model. This performance highlights the sound positioning of our Retail activities and the quality of our Luxury Goods portfolio.

"Our ambition for 2007 is to further improve the Group's operating and financial performances and to significantly improve value creation."