- “It’s not a catastrophe, it’s a correction,” Babin says
- July, August sales “exactly in line with first semester”
The impact of China’s slowing growth on luxury-goods sales shouldn’t be overstated, according to Jean-Christophe Babin, chief executive officer of Italian jeweler Bulgari.
“It’s not a catastrophe, it’s a correction,” Babin said Wednesday in an interview with Bloomberg Television at the World Retail Congress in Rome.
China’s devaluation of the yuan last month sparked a sell-off in global equities on concern the world’s second-largest economy may be in worse shape than previously thought. That added to reports of declining luxury sales in the country, including at Bulgari owner LVMH Moet Hennessy Louis Vuitton SE, following a government clampdown on lavish spending.
Recent declines in share prices have brought world stock markets back “to what we all considered a good level last year,” Babin said.
With economic growth of around 6.8 percent in China, there are still enough new customers who can afford Bulgari’s trinkets, the CEO said. That means the Rome-based company will continue to invest there, opening stores and spending on advertising, he said, while forecasting “very positive results in the country” this year.
Bulgari’s global sales in July and August were “exactly in line with the first semester,” Babin said, declining to provide figures.
The yuan’s devaluation hasn’t deterred spending outside China and Bulgari is on course for record travel purchases this year, Babin said. The CEO also said he expects luxury-goods makers to increase prices on the mainland to at least compensate for the weaker currency.