LONDON — An improving economic climate, product launches and a particularly bright fourth quarter helped drive Compagnie Financière Richemont SA sales for the fiscal year ended March 31.
Sales for the year dipped 7.6 percent to 3.38 billion euros, or $4.02 billion, from 3.65 billion euros, or $4.34 billion. On a constant currency basis, however, sales were flat against the corresponding period last year.
Figures have been converted from the euro at current exchange.
“We’ve reached a turning point, and things are looking up,” a Richemont spokesman told WWD. “We’re in a growth phase now, and on track with our strategies. We are upbeat about the first quarter of the current fiscal year, although we acknowledge that we’re coming from a weak base. The first quarter last year was disastrous between SARS and the war in Iraq.”
Retail sales fell 7 percent to 1.39 billion euros, or $1.65 billion at current exchange rates, but rose 2 percent at constant rates. Wholesale sales fell by 8 percent to 1.98 billion euros, or $2.36 billion, and were flat against the previous year in constant currency terms.
The fourth quarter saw a 10 percent spike in sales, always at constant exchange rates. In Europe, fourth-quarter sales rose by 8 percent, while in Asia-Pacific they rose by 18 percent, despite a 2 percent drop in Japanese sales. In the Americas, fourth-quarter sales rose 23 percent at constant rates. In the third quarter ended Dec. 31, sales increased 4 percent at constant exchange rates.
“Richemont’s specialist watch brand sales were strong in [the third quarter], and new product launches at Cartier in the second half increased store traffic,” said one London-based luxury analyst. “Watches, which have been weak over the past two years, are clearly coming back. At Richemont, IWC and Jaeger-LeCoultre in particular are doing very well.”
Cartier generates about 50 percent of Richemont’s sales and 90 percent of earnings before interest and taxes. During the second half, the brand launched Les Délices de Goa, a line of colorful jewels made from amethyst, turquoise and coral. In addition, it revived the Panthère collection, a line of jewels made from diamonds and emeralds in panther shapes.
On the watch front, Cartier also launched a small Roadster model for ladies. Earlier this month, it revived its Santos watch, which celebrates its centenary this year.
Sales in the second half fell 1 percent at actual exchange rates, and rose 6 percent at constant rates. In the six-month period, the main drivers of growth were Asia-Pacific and the Americas.
During the second half, sales in Asia-Pacific rose 4 percent, and those in the Americas rose 3 percent at actual exchange rates. In constant currency terms, Asia-Pacific sales rose 19 percent while those in the Americas rose 20 percent.
Richemont will report full profit figures for the 2003-’04 fiscal year on June 10.