Richemont Sales Up Despite Asia Concerns

RAPAPORT… Richemont’s jewelry sales increased 12% in the first fiscal
half, though signs of weakening in Asia raised investor concerns.

Jewelry proceeds at Cartier and Van Cleef & Arpels rose to EUR 2.45 billion ($2.77
billion) in the six months ending September 30, while watch sales grew 4% year on year to EUR 2.49 billion ($2.82 billion), Richemont reported Friday.
At constant exchange rates, jewelry sales were up 15%.

Cartier’s Love brand and the Van Cleef & Arpels Alhambra collection were the best performers, while Asia Pacific and the Americas were the strongest regions for jewelry overall, the company noted.

Richemont chairman Johann Rupert cautioned, however, that consumer demand was increasingly volatile amid the uncertain economic and geopolitical environment. A typhoon in Hong Kong and the weak Chinese yuan dented tourist demand in September, finance director Burkhart Grund added, according the Financial Times.

Still, group sales jumped 21% to EUR 6.81 billion ($7.72
billion) for the period, while operating profit fell 3% to EUR
1.13 billion ($1.28 billion) due to acquisition costs. The company recently acquired online luxury retailer Yoox Net-A-Porter and Watchfinder, an omni-channel platform for pre-owned timepieces, which were both incorporated to the company during the period. Online sales accounted for 14% of the group’s total revenue, management reported. 

Shares in Richemont fell more than 6% on Friday following the earnings announcement. 

Image: Cartier store, Paris. (Jakub Szypulka)