Richemont sales rise 21% and profit soars 52 percent in six-month period

Luxury goods company Richemont posted a 21-percent jump in sales for the half-year period that ended on September 30 at actual exchange rates, and by 12 percent at constant exchange rates.

Sales for the period rose to US$6.49 billion (€5.11 billion) from US$5.35 billion (€4.21 billion).

Profit for the period increased by 52 percent to US$1.37 billion (€1.08 billion) from US$901 million (€709 million)

The group said the increase in sales largely reflected sales growth in its own retail network, bolstered by very strong demand in Europe.

Gross profit rose by 24 percent, helped by favorable currency movements, price increases and the growing proportion of sales made through the Maisons’ own boutiques.

Operating profit increased by 28 percent to US$1.75 billion (€1.38 billion), reflecting the significant increase in gross profit, offset by an increase in operating expenses of 21 percent, or 14 percent at constant exchange rates.

Selling and distribution expenses were 23 percent higher, reflecting in particular the increase in sales in the Maisons’ own boutique networks.

Executive Chairman and Chief Executive Officer Johann Rupert said Richemont’s financial position continues to be strong, with net cash position of US$3.81 billion (€3 billion).

"Richemont is seeing good growth in Europe, supported by Asian tourism which is compensating for slower domestic Asia Pacific sales. Retail continued to lead wholesale, reflecting robust jewellery sales," Rupert says.

"For the second half of the year, the comparatives are likely to be impacted by less favorable exchange rates. With a view to strengthening the manufacturing base and exploiting growth opportunities as they arise, the Group’s Maisons will execute their investment programmes as planned," he adds