Luxury conglomerate Richemont has reported strong Q3 sales, driven by increased tourist activity in Europe and Japan. Despite challenges in China due to the ongoing impact of Covid-19, the company’s fashion labels continued to show growth. Richemont, the world’s second-largest luxury group, owns brands such as Chloé, Cartier, Dunhill, and Alaïa. Sales for the final three months of the year reached €5.4 billion ($6 billion), slightly below analysts’ expectations but still a solid 8% increase compared to the same period last year.

Japan experienced a significant sales recovery, with a 30% increase, or 43% at constant currency rates. The combination of local shoppers and the gradual revival of tourism played a crucial role in this growth. Europe also saw a strong sales increase of 17% (19% at constant currency rates), benefiting from a mix of local shoppers and luxury consumers from the Middle East and the US. The Americas witnessed a 16% rise in sales, with noticeable growth in high single digits for American clients globally.

However, Richemont reported a decline in sales in the Asia Pacific region, particularly in China, Hong Kong, and Macau, due to a surge in Covid-19 cases. This led to a 7% decrease in sales (9% at constant currency rates) in the region. Reduced visitor traffic and staff unavailability resulted in adjusted store hours or temporary closures. Sales specifically in mainland China declined by 24%.

Retail sales for Richemont increased by 9% (6% at constant currency rates), amounting to €3.7 billion ($4.1 billion). Online retail also saw growth, with a 12% increase (6% at constant currency rates), totaling €391 million ($436 million). Wholesale and royalty income rose by 5% (1% at constant currency rates) to €1.29 billion ($1.44 billion). The Jewellery Maisons and the “Other” business areas experienced double-digit sales growth, offsetting a 3% drop in sales from the Specialist Watchmakers sector.

It’s important to note that Richemont’s financial figures are reported differently now compared to the past, as the company sold a controlling stake in Yoox Net-A-Porter and moved Watchfinder & Co into the “Other” business area. The “Other” segment encompasses the company’s fashion labels, and sales growth in this area was driven by increased sales across most Maisons, particularly at Alaïa and Peter Millar. YNAP was the only exception, with a slight 1% decrease in sales.

Overall, Richemont’s Q3 sales demonstrate resilience in the luxury sector, despite the ongoing challenges caused by the pandemic, particularly in China. With an increase in tourist activity in Europe and Japan, the company is well-positioned for future growth as the world navigates the path to recovery.

Useful links:
Richemont Official Website
Cartier Official Website