Richemont posted a double-digit drop in fourth-quarter sales as the COVID-19 pandemic took its toll, but said better days may lie ahead as it notes strong demand at its reopened boutiques in China.
Sales in the company’s fiscal fourth quarter, which ended March 31, dipped 18 percent year-over-year at actual exchange rates with the Asia-Pacific region hit especially hard.
Protests in Hong Kong coupled with the COVID-19 pandemic contributed to a 36 percent drop in sales, including a 67 percent decline in Hong Kong.
In the Americas, quarterly sales were up 9 percent year-over-year while in Europe, sales were down 9 percent.
Richemont noted its jewelry brands and online distributors were growth-drivers and “showed resilience” despite the rough quarter.
“The luxury goods industry is in a privileged position,” said Chairman Johann Rupert in a statement, adding that hard luxury products are the embodiment of “centuries of heritage and craft skills.”
“Cartier was established in 1847 and has survived two world wars; Vacheron Constantin began manufacturing watches in its current premises in Geneva in 1755,” he said. “Our maisons will survive these difficult times, supported by the strength of Richemont’s balance sheet.”
In the full fiscal year ended March 31, sales were flat at constant exchange rates, totaling €14.24 billion ($15.37 billion), slightly higher than the €14.1 billion ($15.2 billion) analysts had expected. Excluding online sales, annual sales were down 3 percent year-over-year at constant exchange rates.
Retail sales (sales at Richemont-owned and -operated boutiques) dipped 2 percent at constant exchange rates, which the company attributed to the protests in Hong Kong and France earlier in the fiscal year as well as the impact of the COVID-19 pandemic starting in January.
Photos © Clash de Cartier.
