Richemont Announces Double-Digit Sales Growth In The First Quarter of 2022

Richemont’s unique portfolio includes prestigious Maisons distinguished by their craftsmanship and creativity, alongside Online Distributors that cultivate expert curation and technological innovation to deliver the highest standards of service. Richemont’s ambition is to nurture its Maisons and businesses and enable them to grow and prosper in a responsible, sustainable manner over the long term.

Operating in four business areas: Jewellery Maisons with Buccellati, Cartier, and Van Cleef & Arpels; Specialist Watchmakers with A. Lange & Söhne, Baume & Mercier, IWC Schaffhausen, Jaeger-LeCoultre, Panerai, Piaget, Roger Dubuis, and Vacheron Constantin; Online Distributors with Watchfinder & Co., NET-A-PORTER, MR PORTER, THE OUTNET, YOOX, and the OFS division; and Other, primarily Fashion & Accessories Maisons with Alaïa, AZ Factory, Chloé, Delvaux, dunhill, Montblanc, Peter Millar including G/FORE, Purdey and Serapian.

Here is the Richemont review of trading during the three-month period that ended 30 June 2022 versus the prior year, at constant exchange rates

All channels and business areas, as well as most regions, generated sales growth versus the prior year period notwithstanding an uncertain environment and demanding comparatives following a 129% sales rebound in the prior year comparable period.

The 12% sales growth delivered in the quarter ended June 2022 was driven by strong double-digit increases in Europe, the Americas and Japan. Sales in Europe grew by 42% sustained by robust domestic demand and a return in tourist spending, primarily from American and Middle Eastern clients. Growth was strong across markets, particularly in France where sales increased by triple digits. In Asia Pacific, the strict enforcement of a zero covid policy led to double-digit sales declines in mainland China and Macau SAR (China) and to a single-digit sales reduction in Hong Kong SAR (China). Sales in mainland China were 37% lower for the quarter, although the rate of decline softened to 12% in June when restrictions were progressively eased. The solid momentum across most other Asian markets, notably in Australia, Singapore, South Korea and Thailand, partially mitigated the decline of sales in the region, with sales in Asia Pacific overall contracting by 15%. In the Americas, sales rose by 25% notwithstanding demanding comparatives against the prior year period, driven by strong domestic spending. As a result, for the quarter the US was Richemont’s largest single market, accounting for 22% of Group sales. Japan posted the strongest regional performance with an 83% growth in sales, supported by strong local demand. Sales in the Middle East and Africa increased by 6% on demanding comparatives, reflecting solid domestic and tourist spending, notably in Dubai and Qatar.

All channels recorded sales growth, with retail posting the strongest relative channel performance. Retail sales rose by 18%, driven by double-digit increases across all business areas, and noteworthy performances in Europe, the Americas and Japan. Online retail sales increased by 5%, reflecting muted sales progression at the Group’s Online Distributors and strong growth at our Jewellery Maisons and Specialist Watchmakers. Direct sales to clients for the Group as a whole represented 75% of Group sales, a circa 200-basis points increase over the prior year period. Sales in the wholesale channel increased by 4% as higher sales at our Other business area more than offset lower wholesale sales at our Jewellery Maisons and Specialist Watchmakers which were impacted by ongoing Covid-related restrictions in China.

Despite the disruption experienced in China, the Jewellery Maisons generated a 12% sales growth benefitting from thriving retail sales and solid jewellery and watch sales at Buccellati, Cartier and Van Cleef & Arpels. Sales progressed in all regions and channels, excluding Asia Pacific and wholesale. The Specialist Watchmakers’ sales increased by 10%, driven by online and offline retail sales, which together contributed to 53% of the business area sales. Growth was achieved in most Maisons and regions with an ongoing outperformance of A. Lange & Söhne, Panerai and Vacheron Constantin. The Group’s Online Distributors recorded a 2% sales progression and continue their shift towards a hybrid business model. The Group’s Other business area, mostly composed of our Fashion & Accessories Maisons, posted the strongest sales increase at +28%, supported by strong retail and wholesale sales with sustained demand across most Maisons and regions. Peter Millar continued to deliver a robust performance while Delvaux posted a strong contribution, and the renewed creativity supported by new designers at Alaïa, Chloé and Montblanc positively impacted sales.

The Group’s net cash position at 30 June 2022 was € 5.4 billion (2021: € 3.6 billion), reflecting the quarter’s strong trading as well as replenishment of inventories.

Highlights

• Positive start to the financial year with double-digit sales growth both at actual exchange rates (+20%) and constant exchange rates (+12%)
• Strong performance driven by higher sales in Europe, Americas, Japan and the Middle East and Africa more than offsetting lower sales in Asia Pacific; the US, Richemont’s largest single market for the quarter, comprising 22% of Group sales
• Growth led by retail, now accounting for 58% of Group sales compared to 55% in the prior year period
• Sales growth across all channels and business areas, both at constant and actual exchange rates:
• Jewellery Maisons delivering sales growth of 20% at actual exchange rates (+12% at constant rates)
• Specialist Watchmakers growing by 18% at actual exchange rates (+10% at constant rates)
• Online Distributors increasing by 8% at actual exchange rates (+2% at constant rates)
• Other business area progressing strongly by 36% at actual exchange rates (+28% at constant rates