Information from the business – Outcomes of the primary half of 2019 of the Richemont group – Total progress, watchmakers stay flat

The Swiss-based luxurious conglomerate, Richemont Group, has simply revealed its buying and selling replace for the six months ended September 31, 2019. These unaudited consolidated outcomes present the Group's total progress. Nonetheless, the scenario must be nuanced: one on one aspect, there’s a constructive impression on Jewellery Homes and On-line Distributors, then again, the gross sales of the Homes of the watches are nearly steady, mixed with a tough atmosphere in Hong Kong – one of many Group's principal markets.

Whereas Swatch Group's 2019 semi-annual report confirmed a decline in gross sales and profitability, in addition to large stock, its principal competitor, Richemont, continues to develop – on the group degree, gross sales rose 9% at precise change charges to succeed in EUR 7,397 million (and 6% at fixed change charges). The Group is rising in all areas, distribution channels and companies. Nonetheless, this must be nuanced as a result of the outcomes aren’t homogeneous.

First, it needs to be famous that this 9% gross sales progress is especially pushed by Bijoux-Cartier and Van Cleef Houses, with gross sales up eight% and earnings up four%. % – in addition to on-line retailers – Yoox Internet-A-Porter and Watchfinder, with reported 32% gross sales progress, however up 69%, are attributable to decrease gross margin. These two sectors symbolize greater than 65% of the Group's turnover (€ four,915 million out of a complete turnover of € 7,397 million), their constructive turnover having a substantial impression on the group.

Watch firms, which now symbolize 1,567 million euros (solely 21% of group gross sales), posted muted gross sales with a 1% progress and a slight decline in working outcomes (- 1%). The group reported that common single-digit progress in immediately operated shops greater than offset the decline in wholesale gross sales, impacted by prudent stock administration and the modernization of the wholesale distribution community. Efficiency assorted by dwelling and area, with the strongest progress recorded at Panerai, Lange & Söhne and Vacheron Constantin and at regional degree in Japan. Gross sales progress was reasonable in Asia-Pacific, following a double-digit decline in Hong Kong SAR, China.

By way of gross sales by area, gross sales in Europe elevated by 7%, however excluding on-line distributors, gross sales within the area have been broadly according to these of the earlier 12 months. The UK recorded double-digit gross sales progress after a drop from the earlier 12 months, whereas gross sales in France and Switzerland declined because of decrease tourism spending, particularly buyer spending. Chinese language.

Gross sales on the American continent are up, with + 6%, underneath the impetus of america, the biggest market in Richemont. Asia stays essentially the most heterogeneous market. Total, the area recorded gross sales up 5% over the interval and four% excluding on-line distributors. There was progress at most websites, with robust double-digit gross sales progress in China and Korea greater than offsetting the contraction in double-digit gross sales in Hong Kong, the place gross sales have been affected by road protests. .

Total, the Richemont Group's on-line distribution diversification benefited each gross sales and earnings – working revenue elevated three% over the interval. This diversification offsets the slight outcomes seen in historic firms comparable to watchmaking, the place gross sales are comparatively steady. It needs to be famous that the group continues to be producing money stream, which has elevated by 62% over the interval.

The watch business confirmed indicators of stagnation in 2019: Swiss watch exports grew by 2.eight% within the first 9 months of 2019. The slowdown in latest months naturally raises questions. Particularly as watchmakers are notably affected by anti-government protests in Hong Kong, a hub of watch gross sales.

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