Geneva—Hit by currency exchanges, Compagnie Financiere Richemont AG, parent to Cartier, Van Cleef and other top luxury brands, reported today “subdued” sales in its first five months.
For the five months ended August 31, Richemont posted only a 4% increase at constant exchange rates, At actual exchange rates, sales rose 1%, negatively impacted by the weakening of the U.S. dollar and the yen against the euro.
Wholesale Down Too
European and Middle-Eastern sales grew 6%, helped by the continued benefit from tourism, Richemont noted. Sales in the Americas remained strong, increasing 7% on a reported basis and 12% in constant currencies.
In the Asia-Pacific. sales declined 2% on actual basis, but remained flat in constant currencies. Sales were lower in Hong Kong, Macau and mainland China, offsetting positive developments in other markets. In mainland China, retail sales grew while the rate of decline in wholesale sales softened.
However, in Japan, where consumers splurged ahead of a new sales tax increase in March, sales fell 14% as demand slowed from April to August.
Retail sales growth was up 3% and continued to outperform wholesale sales, albeit at a lower level than a year ago. For example, sales at Van Cleef & Arpels and at Net-A-Porter were particularly noteworthy. Wholesale sales were down 1%.
By classification, jewelry sales remained flat, while specialist watchmakers posted a 2% increase. Cartier’s jewelry business continued to outperform watch sales, which have suffered from weak demand and destocking, particularly in Asia-Pacific.
As announced in May, the Montblanc Maison, which was previously considered a separate reporting segment, is now aggregated and disclosed in Other. The prior year comparatives have been restated to reflect this change.