Richemont’s first half sales at 10.1 billion euros were down 1 percent at actual exchange rates, while operating profit from continuing operations reached 2.2 billion euros, down by 17 percent or by 12 percent at constant exchange rates, resulting in a 21.9 percent operating margin.

During the period under review, the company completed the acquisition of Italian jewellery retailer Vhernier and signed an agreement to sell YNAP to Mytheresa in exchange for a 33 percent equity stake.

“In the first half of this fiscal year, we continued to deliver sustained resilience in a world where uncertainty has become the norm. We saw solid sales growth across most of our regions offsetting continued weakness in Chinese demand, which, as I had predicted, will take longer to recover and is particularly affecting our Specialist Watchmakers,” said Johann Rupert, Richmont chairman in a statement.

Review of Richemont’s first half performance

The company posted a 1.7 billion profit for the period from continuing operations for the period under review.

Sales at the jewellery segment were up 2 percent at actual exchange and 4 percent at constant exchange rates, while Specialist Watchmakers witnessed a decline of 17 percent at actual exchange and 16 percent at constant exchange rates. Sales were up 4 percent in the ‘other’ business area, at both actual and constant exchange rates.

The company added that in Europe and the Americas, sales increased by 4 percent and 10 percent at actual exchange rates, respectively, driven in both cases by local demand and by increased tourist spending in Europe.

Asia Pacific sales contracted by 19 percent, as growth in some countries, including Korea and Malaysia, was more than offset by a double-digit decline in sales for China, Hong Kong and Macau combined. The strongest regional sales growth rate was once again posted by Japan, where sales were up by 32 percent compared to the prior-year period.

Sales in the Middle East & Africa also grew, by 11 percent compared to the prior-year period.

Retail sales were in line with the prior period and up by 2 percent at constant exchange rates, accounting for 70 percent of total Group sales. Online retail sales, which exclude sales made by YNAP, make up 6 percent of total sales and were 7 percent higher than the prior period. Sales in the wholesale channel declined by 7 percent, as higher sales in the Americas, Japan and Middle East & Africa were unable to offset the reduction in Asia Pacific.