Business

Virus chokes sales at luxury giant Richemont

Swiss luxury group Richemont said Thursday that its sales plunged 47 percent in the last quarter as coronavirus-related lockdowns kept consumers away from its boutiques.

Richemont, ranked second only to French giant LVMH, has pushed strongly into online retail in recent years, but even this suffered a 22 percent drop as some order fulfilment centres were shut.

However the group, which counts the jeweller Cartier among its brands, said sales in China rose strongly during the April-June period.

China, where lockdowns had already been lifted before the quarter started, “delivered triple-digit online sales growth and very strong domestic retail sales in the absence of overseas purchases from the Chinese clientele from the mainland.”

Chinese tourists are major buyers of luxury goods when they travel to Europe, but the coronavirus crisis has brought most international tourism to a halt.

Richemont has allied itself with China’s giant online retailer Alibaba to reinforce its position.

Overall, Richemont’s sales came in at just short of 2.0 billion euros ($2.3 billion) during the April-June period, which is the company’s first quarter.

The group said all of its distribution centres and most stores had reopened except for those in the Americas and those located in airports.

Richemont’s shares fell 5.3 percent in morning trading, while Switzerland’s main share index was down 1.0 percent overall. Agence France-Presse

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