SWITZERLAND: Asian tourists boost Richemont H1 profit
- H1 profit up 52% to EUR1.08bn
- Sales rise 21% to EUR5.11bn
- Warns exchange rates will impact H2
Luxury goods group Richemont posted major increases in first-half earnings and sales, buoyed by favourable exchange rates, successful launches and strong pricing.
The Swiss company said its business in Europe in the three months to 30 September had been particularly strong, boosted by the growth in Asian tourism, which helped offset slower sales in Asia Pacific domestic markets.
Meanwhile, sales performance in the company’s own retail network had also helped to drive the performance.
However, Richemont chairman and CEO Johann Rupert said that sales growth had moderated recently, with sales up 12% in October, and warned that second half comparatives were likely to be affected by less favourable exchange rates.
Jon Copestake, retail analyst at the Economist Intelligence Unit, said the results show Richemont is "encountering the same challenges highlighted by many similar firms in recent months.
"Luxury growth is slowing in Asia, after the rapid expansion of recent years. Nonetheless the "slowdown" still reflects 7% sales growth for Richemont, which is mouthwatering compared to the static performance in some markets. Additionally, outbound retail tourism from Asia is also supporting sales growth in Europe."
Switzerland-based luxury goods company Richemont is expected to record substantial profit growth for the year to 31 March, thanks to favourable exchange rates....
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