Richemont Reports Unchanged Earnings on Chinese Market Slowdown

Cie. Financiere Richemont SA (CFR), the maker of Cartier jewelry and Montblanc pens, reported unchanged full-year earnings, capping three years of growth, after China cracked down on bribery and extravagance among government officials.

Operating profit was little changed at 2.42 billion euros ($3.3 billion) in the 12 months through March, the Geneva-based luxury-goods maker said today in a statement. That matched the 2.42 billion-euro average of 26 analyst estimates compiled by Bloomberg.

Richemont gets about half its sales from the Asia-Pacific region plus Japan. Retail sales of jewelry, watches and clocks fell 8.9 percent in March in Hong Kong, statistics have shown. Consumption may also slowed in Japan due to an increase in value-added tax in April.

Revenue gained 5 percent to 10.7 billion euros. Exchange-rate shifts such as the weakening of the dollar to the euro stripped 5 percentage points off sales growth. Sales in April rose 6 percent excluding currency fluctuations.

The stock has gained 8.7 percent in the past year, giving the company a market value of 50 billion Swiss francs ($56 billion). The company said it plans to pay a dividend of 1.40 francs a share.

Richemont owns 20 businesses, most of which are at least a century old, including Vacheron Constantin, a Swiss watchmaker founded in 1755 and Purdey, a luxury shotgun maker formed in 1814. The most recent business addition is Giampiero Bodino, an Italian high-end jeweler that only sells by appointment.

To contact the reporter on this story: Janice Kew in Johannesburg at jkew4@bloomberg.net

To contact the editors responsible for this story: Celeste Perri at cperri@bloomberg.net Thomas Mulier, Paul Jarvis

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