Richemont posts 16 percent sales gain
William George Shuster, JCK Senior Editor -- JCK Online, 9/14/2006 3:44:00 PM
Compagnie Financiere Richemont AG, one of the world's largest luxury-goods producers, said Thursday that its sales rose 16 percent between April and Aug. 31. The five-month result, including an 18 growth in revenue, were propelled in part by strong sales of fine jewelry and luxury watches, by luxury retailer Cartier, and by business gains in the Asia-Pacific and Americas regions.
The company statement, including an assessment by executive chairman Johann Rupert, was issued just ahead of its annual general meeting at its headquarters in Geneva, Switzerland Thursday. Richemont's statement gave only percentages, not actual amounts. However, its 2006 fiscal year (ended Mar. 31, 2006) had sales of about $3.5 billion, a 17 percent gain.
"The very positive growth in sales we saw last year … has been sustained," Rupert said, giving a strong start to Richemont's current fiscal year. Based on the April to August results, he said half-year returns will be good and is "confident for the year as a whole.''
The upbeat Richmond report matches similar ones recently issued from other major luxury goods makers, such as LVMH, Bulgari, and the watchmaker Swatch Group.
Among Richemont's divisions, jewelry houses Cartier and Van Cleef & Arpels reported "excellent sales," increasing 13 percent. For Cartier, Rupert said, "a strong performance in high jewelry and the success of the Love jewelry collection and the La Dona, Pasha Seatimer, and jewelry watches generally contributed strongly to this." For Van Cleef & Arpels, it was the Pierres de Caractère and l'Alhambra collections.
Richemont's luxury watch brands had a "commendable performance" in a "very competitive" watch market, growing 16 percent, said Rupert. He singled out the performance of the Jaeger-LeCoultre, Piaget, and Panerai brands.
Richemont's writing instruments (Montblanc and Montegrappa) recorded a 23 percent increase in sales. Montblanc "continues to develop as a more broadly-based luxury business," Rupert said. "Building on its core writing instruments, it is growing its watch and leather goods businesses and seeing good sales of its new silver jewelry lines."
Regionally, sales in the Asia-Pacific area rose 20 percent, while the Americas and Europe both had 17 percent gains. Business was slower in Japan (up eight percent), due to the strength of the euro against the yen this year.
Some 60 percent of Richemont's sales are outside Europe, though the vast majority of its manufacturing takes place in Switzerland and a few other locations in Europe.
Richemont's portfolio includes the major brands of Cartier, Van Cleef & Arpels; Jaeger-LeCoultre, Piaget, IWC, Baume & Mercier, Vacheron Constantin, Officine Panerai, A. Lange & Söhne, Montblanc, Montegrappa, Alfred Dunhill and Lancel. In addition, Richemont holds an 18.8 per cent interest in British American Tobacco.
