Richemont profit and sales jump, discussions about YNAP continue

LUXURY goods group Richemont said on Friday (May 20) discussions about its “Luxury New Retail” partnership should be concluded “in the near future”, after strong American demand for its jewellery and watches boosted net profit and sales in the 12 months to March.

The maker of Cartier jewellery had been expected to give an update on plans to relinquish control of its online retail business YOOX Net-a-Porter (YNAP), notably by selling a stake to Farfetch, but it only said discussions with its “Luxury New Retail” partners were continuing.

“There is considerable complexity, which means the process is inevitably protracted. We look forward to concluding matters in the near future,” Richemont said in a statement.

The world’s second biggest luxury group said it was well positioned to benefit from any resurgence in consumer demand, but was maintaining the necessary flexibility to manage global uncertainties.

Net profit rose 61 per cent to 2.1 billion euros (S$3.1 billion), versus an average estimate of 2.7 billion euros in a Refinitiv poll, while sales when measured in constant currencies jumped 44 per cent to 19.2 billion euros, ahead of an 18.8 billion euro estimate.

The company proposed to pay out a dividend of 2.25 francs as well as a special dividend of 1 franc per share, after an ordinary dividend of 2 francs a year ago.

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Richemont said its decision to suspend commercial activities in Russia led to a charge of 98 million euros in operating expenses. It also had valuation adjustments of 70 million euros for inventories held in Russia. REUTERS