Strong demand for its jewelry and watches in the Americas and Europe amid a post-pandemic recovery helped the world’s second-largest luxury group, increase its quarterly sales by nearly a third, according to an official statement released Wednesday.
The Cartier owner’s sales reached 5.658 billion euros ($6.41 billion) in the third quarter ended December 2021, an increase of 32 percent if currency fluctuations are not taken into account. That’s 38 percent higher than the Christmas 2019 quarter, before the pandemic hit, the Swiss giant said.
Shares, down slightly year-to-date after a 71% jump last year, climbed 5.7% in Zurich in early trading after the announcement of the well above expectations sales.
Demand for luxury goods has risen sharply after the worst of the coronavirus pandemic – Italy’s Prada and Britain’s Burberry also posted strong figures this week – and Richemont is benefiting from rapid growth in its jewelry segment.
Sales of high-end watches also picked up last year, with Swiss watch exports overall slightly above 2019 levels at the end of November.
Sales of Richemont’s jewelry brands, Cartier, Buccellati, and Van Cleef & Arpels, were up 38%, while sales of specialty watchmakers, including IWC and Vacheron Constantin brands, were up 25% year over year.
The Americas showed the strongest growth – 55% – followed by Europe with 42%. China, which had already recovered from the worst of the pandemic the previous year, saw only 7% growth, Richemont said.
Analysts applauded the better-than-expected sales figures, pointing to the rebound in Europe and the strong increase in retail sales at the group’s own stores.
To boost sales and margins, Richemont is shifting from wholesale to directly managed stores and online channels. Direct-to-consumer sales increased again, now accounting for 78 percent of the group’s sales, and online retail sales also increased by 19 percent, the Cartier owner said.
“Richemont has achieved significant improvements at all levels and is currently in an ideal position to create value,” said Jean-Philippe Bertschy of Vontobel, who reiterated his buy recommendation on the stock.
LVMH Group, owner of the Bulgari and Tiffany jewelry brands, is due to publish its annual results on January 27. Swatch Group’s results are also expected around this date.
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Featured Photo : © Richemont
