Richemont, the Swiss luxury-goods company known for brands like Cartier and Van Cleef & Arpels, is set to announce its third quarter fiscal 2024 results on Thursday. Here's what you need to know:
Sales Forecast
According to Visible Alpha consensus, Richemont is expected to report sales of €5.49 billion ($6.01 billion) for the three-month period ending December 31, compared to €5.40 billion in the same period last year.
Key Highlights to Watch
Divisions
Analysts from Deutsche Bank suggest that Richemont's core jewelry division, which includes Cartier and Van Cleef & Arpels, could perform well despite challenges in the market. On the other hand, Vontobel analyst Jean-Philippe Bertschy warns that the specialist watchmakers division, which experienced a decline in sales in the previous quarter, might face a difficult year. Bertschy believes that the entire watch industry will need to reset after a period of significant growth.
Pricing
Given the slowdown in luxury sector sales and an uncertain environment, brands with strong pricing power and high-end products are expected to continue performing well globally. Vontobel's Bertschy specifically mentions Cartier and Van Cleef & Arpels as examples. However, he points out that the industry is still facing challenges such as persistent inflation, high interest rates, mortgage costs in the U.S., and a slower-than-expected recovery in China.
YNAP Deal
Investors will be paying attention to any comments regarding the Yoox Net-A-Porter (YNAP) deal. In December, Richemont announced that its planned transaction with Farfetch would not be completed. While this failed deal may have affected sentiment, Barclays analysts believe that the company's core divisions continue to demonstrate strength.
For more information, contact Andrea Figueras.
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