Strong jewellery sales boost Richemont, shares rally

Richemont has reported sales growth of 4% in the three months to end-December, boosted by a “robust performance” from its jewellery divisions, particularly Cartier, Van Cleef & Arpels and Buccellati.

Strong double digit increases in China and Korea have more than offset a “marked contraction” in Hong Kong. Local protests against the Chinese government have hit tourism and  some Richemont-owned stores have had to close at times due to violent clashes.

Sales in Japan decreased by 7%, impacted by lower tourist spending given a stronger Japanese yen and a new value added tax increase.

Richemont saw the strongest growth (+9%) in Europe, while sales in the Americas rose by 5%, led by good performances in the US that compensated for declines in other markets.

Sales rose by 3% in the Middle East and Africa despite a “soft economic environment”.

While jewellery sales grew by 6%, Richemont says its watchmakers registered modest growth and its fashion and accessories units saw “challenging trading conditions” - with the exception of Peter Millar which continued to show strong momentum in the US.

At the end of last year, Richemont had net cash of €2.4 billion, up from €2.3 billion in 2018.

Richemont's share price jumped more than two percent on Friday morning.