(Reuters) – Luxury group Richemont beat expectations after strong demand from Chinese consumers for jewelry and watches boosted sales in the three months to March 31.
Sales increased 22% at constant rates, driven by strong growth in the Asia-Pacific region.
“China is doing much better,” group chairman Johann Rupert said in a call with reporters.
The major players in the luxury sector, LVMH and Hermes, benefited strongly from the recovery of activity in China, as witnessed by the growth of global sales in the first quarter, of 17% and 23% respectively.
Richemont’s sales topped higher market estimates, said Jean Philippe Bertschy, an analyst at Vontobel, noting that the data points to further polarization between the performance of the strongest brands amid rising prices.
“The polarization between strong brands, creators of iconic pieces, and weaker ones has continued unabated and has accelerated in recent months due to high inflation,” said Bertschy.
Cartier’s parent company Richemont increased its annual dividend to 2.5 Swiss francs ($2.81) for one “A” share and 10 “B” shares, respectively, and announced a special dividend of an additional Swiss franc for one “A” share and 10 “B” shares.
The third largest producer of luxury goods in the world, after Lvmh and Hermes, also said it will buy back up to 10 million “A” shares, equal to 1.7% of the capital.
(Translated by Chiara Bontacchio, editing Stefano Bernabei)