Richemont Declares Strong Financial Results Backed by Strong Demand for Luxury Goods

Happy days are here again for the luxury brands and the luxury goods companies. Richemont, the world’s second-biggest luxury goods company which owns the Cartier jewellery, Montblanc pens and Chloe fashion brands, released very robust financial results for the year gone by. The Swiss group said that the exceptionally strong demand for its jewelry and watches had helped it achieve exceptional growth in sales and profits. The company was able to register a growth in all the regions but the growth was strongest in the Asia Pacific region helped by exceptionally high demand in China.

Net-a-Porter, the online luxury fashion retailer, which was acquired by the group just a year ago also chipped in with positive cash flows which were above the planned and projected figures. Acquired in April 2010 for €245m the online retailer generated sales of €274m. Overall Richemont improved its operating margins considerably by recording a pretax profit of €1.28bn on sales of €6.89bn which were up by a third. Johann Rupert, the executive chairman, highlighted the fact that the achievement was creditable as a stronger Swiss Franc did not slow them down.

The group’s jewelry houses and specialist watchmakers all achieved record sales and profits. Montblanc improved its performance and progress was seen in the performance of fashion and accessories as well. The sales of the Asia Pacific division rose by a healthy 36% but the American sales were not far behind as they rose by about 30%. Europe recorded an increase of 20% in sales but Japan could manage an increase of only one percent as the Yen appreciated significantly. The analysts however warn against complacency as the operating margins dropped in the second half of the financial year and the company will need to pull up its socks to maintain the profitability this year.

Via: independent

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