Richemont Group sales up 4% in 3rd quarter

The luxury group Richemont ranked as the world's third-largest luxury goods conglomerate in terms of sales and a giant in the world of jewelry and watches, has just announced a 4% increase in third-quarter sales at actual exchange rates and 8% at constant exchange rates. This amounts to sales of 5.59 billion euros for the last three months of 2023.

Some analysts, such as Zuercher Kantonalbank, were expecting higher results (according to the Zurich bank, the company should have achieved sales of 5.7 billion euros), while other firms, such as Barclays and RBC, were less optimistic, forecasting sales of 5.48 and 5.44 billion euros respectively. In terms of geographical regions, sales in Europe fell by 4% at actual exchange rates. This was due to lower spending by international tourists, particularly Americans. By contrast, all other regions reported higher sales. These results are particularly positive in view of the fragile situation in the luxury goods industry in recent months, caused by widespread inflation, rising mortgage costs in the United States, and political instability in several countries, slowing down the markets. Japan recorded the strongest sales growth with +18% at constant exchange rates (+8% at actual exchange rates), followed by Asia-Pacific with +13% and Middle East-Africa with +10% at constant exchange rates and +5% at actual exchange rates.

Once again, Richemont's jewelry houses (including Cartier, Van Cleef & Arpels, and Buccellati), accounting for around 58% of the Swiss group's sales and over 86% of its profits, were the driving force behind its success (3.95 billion euros). Sales rose by +12% at constant exchange rates and +6% at actual exchange rates. By contrast, sales in the watchmaking division (939 million euros) fell back slightly, by +3% at constant exchange rates and -1% at actual exchange rates, due to the effects of lower global demand and unfavorable exchange rates. Most of these prestigious houses (Richemont owns Vacheron Constantin, Piaget, Jaeger-LeCoultre, IWC Schaffhausen, Lange & Soehne, Officine Panerai, and Montblanc, among others) are now focusing on strengthening their iconic luxury products, which are less affected by fashion trends. Buyers see this as a stable investment, and brands can benefit from regular customer demand.

According to analysts, sales for the Swiss group will increase by a further 6% over the next decade, thanks to the growing number of high-net-worth clients worldwide.