Cartier owner Richemont’s third-quarter sales rose 10%, still weak in China

Owner Cartier Richemont On Thursday, it reported a 10% increase in fiscal third-quarter sales even as Chinese demand took a hit, a positive sign for the health of Europe’s luxury goods sector during the holiday shopping period.

Sales rose to 6.2 billion euros ($6.38 billion) at constant exchange rates in the three months to the end of December, which the Swiss luxury brand described as “the highest quarterly sales figure ever.” That was well above the 1% increase that analysts had expected in a consensus cited by RBC, according to Reuters.

The company posted double-digit growth in all regions except Asia Pacific, where sales fell 7%, driven by an 18% decline in the mainland China, Hong Kong and Macau regions combined.

China, once a major driver of demand for luxury goods, has been a major drag on the sector as it struggles to emerge from the overall economic slump following the Covid-19 pandemic.

The Swiss company’s share price faced a volatile journey over the past year amid the reorganization of its senior management and broader fluctuations in the luxury products market.

The stock jumped on the May appointment New CEO Nicolas Bossformer president of the group’s Van Cleef & Arpels jewelry brand. Shares are currently up 28.75% over the year.

The results represent a return to growth for the company, which posted a 1% year-on-year decline First half sales Until September, citing the difficult macroeconomic background and tougher conditions in China. Sales during the six-month period amounted to 10.1 billion euros.

The luxury group had until then been far from the broader downturn in the luxury goods sector, recording record numbers Full year sales in May.

Luca Solca, senior global luxury goods analyst at Bernstein, said Thursday’s results provided a positive early signal of a return to the health of the broader luxury goods sector.

Europe and the Asia-Pacific region, excluding Greater China, “saw strong sequential improvements, driven by higher domestic demand and strong tourism flows, while the Americas remain driven by strong domestic demand,” Solka said in a note.

“We view this as an encouraging sign and confirmation – as the market has been anticipating in recent weeks – that the third quarter of 2024 may be down,” he added, referring to the third quarter of the calendar through September.