Richemont completes successful final spurt at the end of the year - and defies the declining watch business

With regard to companies such LVMH, Swatch Group and Kering Richemont's business figures appear almost counter-cyclical.

The luxury goods group achieved sales growth of ten percent in the last quarter of 2024 (the third quarter of Richemont's fiscal year) compared to the same period of the previous year, at constant exchange rates. This equates to €6.15 billion.

Analysts had on average expected a decline of 0.7 percent and estimated revenue at just €5.59 billion.

The seven percent decline in the Asia Pacific region also reflects the slump in consumer spending in China, including Hong Kong and Macau. Sales in those regions alone fell by 18 percent.

In Europe, sales rose by 19 percent, driven by higher domestic demand and tourist spending. Richemont recorded particularly strong performances in France, Switzerland, and Italy.

Sales growth in America was 22 percent, with increases in all business areas due to strong local demand.

In Japan, spending by tourists and locals continued to drive sales, which increased by a total of 19 percent compared to the same period last year.

Sales in the Middle East and Africa region increased by 20 percent, led by the United Arab Emirates and higher tourist spending.

Watch segment is weakening

Looking solely at Richemont's watch segment, the picture is far less rosy. Since the beginning of the current fiscal year in April 2024, every quarter has shown a decline in the percentage change compared to the same quarter of the previous year, starting with -14%, then -19%, and finally -8% in the Christmas quarter of 2024, which suggests a recovery in the watch business is on the horizon.