Richemont’s fourth quarter Asian sales slump due to Covid-19
The group reported that sales in Hong Kong fell by two thirds in its fourth quarter as coronavirus shuttered stores
Global luxury goods retailer Richemont says Covid-19 has had a severe effect on sales in the past three months of its year to end-March, with sales in Hong Kong falling by more than two thirds.
The Swiss-based high-end retailer led by Johann Rupert reported a hit to sales across its global operations, but said it had seen a resumption in demand in China, the first to be hit from the pandemic, and first to start recovering.
“Since our 462 boutiques in China have reopened after the virus, we have seen strong demand,” the group said.
Group sales for the year to end-March increased 2% at actual exchange rates to €14.24bn (R283bn), though sales in the fourth quarter fell 18%.
Profit for the year declined 67% to €931m.
This decrease reflected the non-recurrence of last year’s €1.378bn posttax non-cash accounting gain on the revaluation of the shares of Italian online fashion retailer YOOX Net-a-Porter held before its takeover. Excluding this amount, profit for the year was down 34%.
“We are experiencing unprecedented times with severe disruptions across the world simultaneously,” the group said.
“The closures of our internal and external points of sales, changing attitudes towards consumption and subdued consumer sentiment will weigh on this year’s results, even if, at the time of writing, we are gradually resuming operations as parts of the world emerge from lockdown.”