Richemont Group Releases Q3 Briefing Asia is underperforming

Richemont on the 15th released the third quarter 2014/2015 briefing, the sharp decline in year-on-year results in Asia Pacific, resulting in its stock price fell more than 14% in one day on January 15. From 1st September, 2014 to 31st December, 2014: Group sales of 3.051 billion euros (about 3.59 billion US dollars), an increase of 4%. At constant exchange rates, unchanged from the same period in 2013, lower than Reuters forecast of 1% growth. Strong growth in Europe, the Middle East and the United States offset the decline in the Asia Pacific region. "Occupy Central" incident led to weakness in Hong Kong market, especially the sharp decline in watch demand. The Group's cash flow is plentiful with a carrying amount of 4.9 billion Euros as of December 31, 2014, a 14% increase from 4.3 billion Euros in the same period of 2013. Total sales in the first three quarters of the fiscal year increased by 3% from the same period of last year, and increased by 2% at constant exchange rates. Area: Driven by the depreciation of the euro, the purchasing power of overseas tourists has been enhanced. Total sales in Europe reached 1.192 billion euros, up 9% at constant exchange rates. US sales reached 547 million euros, at a constant rate of 7% over the same period of last year, showing a slowdown compared with the previous six months but maintaining a good momentum. Most of the markets in the Asia Pacific region were in a bad situation with sales of only 1.07 billion euros, a year-on-year decrease of 12% at constant exchange rates. Hong Kong and Macau were especially sluggish. In September and October, some shops were temporarily closed due to the fact that Hong Kong's share of the incident was at the golden week of China. Affected by the increase in consumption tax, the Japanese market continued to slump. Sales of 242 million euros, at constant exchange rates increased by 2%. Channel aspects: Group sales channels directly under the retail sales of 1.744 billion euros, accounting for 57.16% of total sales, at constant exchange rate increased by 2%. Wholesale channel sales of 1.307 billion euros, at constant exchange rates fell 2%. In particular, the report pointed out that the opening of new stores, jewelry sales and luxury goods Net-a-Porter, etc. have become the main driving force behind the growth of retail channels. Category: Jewelry brand sales decreased by 1% year-on-year at constant exchange rates, but its performance in the retail channels was acceptable and demand was strong. The watch brand performed poorly, with a 4% YoY decline in sales at a constant exchange rate. On the one hand because of the cautious attitude of partners, on the other hand because of the decline in demand in Hong Kong, Macao and other regions. Net-a-Porter, a luxury e-commerce operator, continued to grow above the Group average, driving "other" businesses including e-commerce and apparel up 7% YoY at constant rates. (The above table is the quarterly report from September 1, 2014 to December 31, 2014) Richemont quarterly report further illustrates the luxury goods industry has not bottomed out. Earlier, the British brand Burberry said the decline in sales in Hong Kong this quarter may affect the company's full-year profit. US jewelry brand Tiffany also issued a statement that due to poor performance during the holidays, Japan's sales deteriorated further, the company had to lower its 2014 earnings forecast. (The above table shows the Richemont Group from March 1, 2014 to December 31, 2014)