Although sales have been increasing, profits turned out to be below expectations. The company managed to offset, to some extent though, the downturn, in double figures, in Hong Kong market. Montblanc and Chloé leather goods have been going well. Richemont’s performance in the term is all right, though profits have been “running steady in the end”.
Over 7 billion euros in six months
At the end of the first half-year period, Richemont revenues coming from sales amounted to 7.397 billion euros. Therefore, they went up by +9% at current rates of exchange and by +6% at fixed rates of exchange. Profits reached 869 million euros. As reported in the corporate release, profits have been “basically steady, leaving aside a non-monetary capital gain, 1.378 billion euros after tax, recorded in the previous financial statements and resulting from the appreciation in the value of Yooox Net-A-Porter Group’s stocks, formerly held”. The outcome slumps therefore, over -60%, however below forecast issued by financial analysts, 971 million euros, according to informed estimates provided by FactSet.
Montblanc and Chloé “enjoyed a boost”
The Swiss multinational corporation has been enjoying a business boost on all markets: jewellery (+8%) and online (+32%) have been driving sales considerably. As regards the “Other” items (which comprises the group’s fashion houses, accessories and manufacturing of watch components, such as watchstraps), sales have been running steadily in the end, as revenues increased by +1%. Yet, Richemont highlighted that Montblanc and Chloé leather goods sales “have been rising”. As regards the fashion and accessories segment, at the end of the term operating profits amounted to 3 million euros, compared to a 46-million-euro loss they went through last year.
The president’s comment
Johann Rupert, President of Richemont, commented the group’s performance in the half-year period: “Richemont successfully achieved a steady boost and proved resilient in terms of profits, while dealing with a global scenario filled with higher instability”. Rupert emphasized the downturn in sales, in double figures, in Hong Kong, where they had to shut down stores during riots and protests. “Our aim is to create an ethical, inclusive, sustainable and profitable future. The achievement of such accomplishment requires time, investments and impeccable action. While facing worldwide instability, we must stay focused”.
