Richemont releases first-half earnings report for 2017
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Richemont releases first-half earnings report for 2017

The world’s second largest luxury company, Richemont, released an earnings report for the first half of its financial year (ending September 30). The company, which is known for a variety of high-end brands like Cartier and Van Cleef & Arpels, said sales increased by 12% year on year, and at constant exchange rates.

This uptick was driven by growth across all segments, distribution channels, and regions, and the company said “most markets” were now in positive territory. Notable for their outperformance were Mainland China, Korea, the United Kingdom, and Hong Kong – the last of which has finally returned to growth for Richemont.

Richemont’s share price is up by 18% so far this year

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SOURCE: Yahoo Finance

Richemont reported a host of positive news, which matched analysts’ expectations, as the luxury sector continues to see stronger performance in 2017 than it has in recent years. Against the same period in 2016, the company’s profit grew by 80%, while operating profit on a reported basis rose by 46%, and free cash flow from operations increased by 66%. This is a reflection, in part, of strong fundamentals this year – but it’s also true that the first half of 2016 was very poor for Richemont, and thus paints this year’s figures in a very positive light.

In a statement, the company’s chairman Johann Rupert looked to the future, saying: “Richemont’s new Board and management team bring diverse skillsets which are relevant to the challenges our business is facing. They are focused on defining the Group’s transformation agenda to meet the rapidly changing demands of luxury consumers. Our solid balance sheet provides the flexibility and resilience necessary to support our Maisons through this transformation journey.”

Disclosure

Dominion holds Richemont in its Global Trends Luxury Fund.


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