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Richemont shares rise 5.5% on strong Q3'20 sales growth


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Richemont shares rise 5.5% on strong Q3'20 sales growth

Shares of Compagnie Financière Richemont SA rose more than 5.5% on Jan. 17 after the luxury retailer reported a 6% year-over-year increase in fiscal third-quarter sales driven by growth across all of its channels.

For the three months to Dec. 31, 2019, Richemont said revenue rose to €4.16 billion from €3.92 billion, representing a 6% increase at actual exchange rates and a 4% increase at constant currency. The result was in line with the S&P Global Market Intelligence mean consensus estimate, with four analysts reporting.

Retail sales rose 8% year over year at actual exchange rates despite temporary store closures in Hong Kong. Revenue from online grew 8%, wholesales rose 2% and royalty income jumped 38%.

Sales climbed 10% in Europe, 9% in the Americas and 6% in the Middle East and Africa.

Sales in Asia-Pacific rose 3% from the year-ago period as the company's performance in China and South Korea offset a "severe sales contraction" in Hong Kong. Sales fell 1% in Japan, which Richemont attributed to lower tourist spending and a stronger yen.

The company's Jewellry Maisons division grew revenue 9%, driven by the Cartier, Van Cleef & Arpels and Buccellati brands. Sales grew 5% in the Online Distribution division despite an increasingly competitive pricing environment and disruption caused by storm damage to its Mr. Porter's warehouse in Landriano, Italy.

Richemont reported a 4% sales rise in its Specialist Watchmakers unit and a 1% decline in its Other businesses, which include fashion and accessories.

Shares of Richemont were up 5.5% at CHF81.60 in Switzerland in afternoon trading.