China’s Reopening Lifts Richemont’s Jewelry Sales

Jewelry sales at Richemont grew 21% for the full fiscal year amid a recovery in China and the return of tourism from the mainland during the fourth quarter.

Proceeds from the category rose to EUR 13.43 billion ($14.57 billion) for the 12 months ending March 31, Richemont said last week. The increase was driven by “significant sales increases” in Asia Pacific during the January-to-March period following the lifting of travel and health restrictions in China, as well as a strong performance in Japan, Europe and the Americas. All of the company’s jewelry collections, including Cartier, Van Cleef & Arpels, and Buccellati, realized double-digit growth, management noted. Online sales, combined with the jewelry division’s directly operated store network, made up 83% of the division’s sales. Operating profit for the segment rose 23% to EUR 4.68 billion ($5.08 billion).

“The group’s three jewelry maisons…achieved double-digit growth in jewelry and watches,” the company said. “All iconic collections outperformed. This strong performance was also broad-based across all jewelry maisons, price points, regions and distribution channels.”

Sales in the watch division climbed 13% to EUR 3.88 billion ($4.2 billion) for the year, with double-digit increases at many maisons. The opening of new stores also contributed to the rise.

Group profit slid 86% to EUR 301 million ($326.6), impacted by a EUR 3.6 billion ($3.91 billion) loss as a result of discontinued operations, Richemont explained. Sales jumped 19% to EUR 19.95 billion ($21.65 billion), the company’s highest-ever revenue ever, it said. Sales grew in all regions.

“Economic volatility and political uncertainty look set to remain features of the trading environment,” the company noted. “The group will therefore seek to maintain the necessary agility to manage fluctuating levels of demand. I am confident that our maisons are well-positioned to meet strong demand, notably driven by a significant resumption of Chinese travel.”

Separately, Richemont appointed Fiona Druckenmiller to its board of directors. She is the founder of FD Gallery, a New York-based boutique that offers pre-owned luxury items, including vintage and contemporary jewelry.

“[Fiona] brings her financial acumen gained as an equity portfolio manager on Wall Street and also strong business acumen and jewelry expertise,” said Johann Rupert, chairman of Richemont. “Her relentless search for beauty and understanding of the American clientele, an increasingly important customer for the group…will be of great value.”

Image: A Cartier store in Hangzhou, China. (Shutterstock)