News The Geneva based luxury products group Richemont saw its results continue to progress steadily during the first half of the 2008-2009 financial year which closed at the end of September. However the effects of the financial crisis are beginning to be felt, with a slowdown in October.
Between April and September, sales increased by 10% to 2.8 billion euros and net profit by 5% to 864 million, said the company, which regards these results as "satisfactory". Net profit includes Richemont's holding in the British American Tobacco (BAT) group, since outsourced. Without this holding, profit stands at 543 million euros (+11%). Operating profit meanwhile rose by 14% to 639 million euros during the first half-year.
The jewellery sector, represented by the brands Cartier and Van Cleef & Arpels, recorded sales growth of 11% to 1.42 billion euros. Another mainstay of the group, watchmaking – with in particular Piaget, Jaeger-LeCoultre, IWC and Vacheron Constantin – registered an increase of 12% to 794 million euros. However, sales for Montblanc and Montegrappa, known in particular for their pens, increased by only 1% to 286 million euros, while turnover in leather goods (Alfred Dunhill and Lancel) actually fell by 5% to 130 million. In the segment of other activities, which includes in particular the Chloé brand, the increase was 19% to 170 million, due mainly to group acquisitions.
Overall, sales fared best in the Asia-Pacific region (+19% to 729 million euros), and also in Europe, Richemont’s main market (+15% to 1.26 billion euros). Turnover declined however both in the Americas (-2% to 497 million) and in Japan (-7% to 315 million).
Nonetheless, Richemont noted a marked slowdown in growth during October (+1.6%). The chaos which resulted from the financial crisis is now having repercussions on the global economy, said Johann Rupert, the group’s CEO.
November 25, 2008