© Reuters. FILE PHOTO: A man wearing a protective mask walks by the luxury Cartier jewelry store at the Americana Manhasset open-air shopping complex in Manhasset, New York, U.S., May 3, 2021. REUTERS/Shannon Stapleton
ZURICH (Reuters) -Cartier maker Richemont proposed to double its dividend on Friday after net profit rose by a third in its fiscal year 2020/21, helped by a strong performance of its jewellery brands and as it benefited from net finance income.
Luxury watch sales have been recovering recently from the severe pandemic hit, with Richemont, the global No.2 in luxury goods, faring better than rival Swatch Group (SIX:) thanks to its exposure to the fast-growing jewellery category.
Richemont did not give an outlook for the year, but Chairman and controlling shareholder Johann Rupert cautioned in a statement that “volatility and low visibility are likely to prevail until there is herd immunity” against COVID-19.
Net profit at Geneva-based Richemont rose by 38% to 1.289 billion euros ($1.58 billion) in the group’s fiscal year to March, ahead of a forecast for 821 million euros in a Refinitiv poll.
Sales fell 5% at constant exchange rates and 8% at actual rates to 13.14 billion euros, also beating the 13.02 billion estimate in the poll thanks to a strong recovery in the final quarter.
Bernstein analyst Luca Solca said the results were a “strong beat to consensus, built on the outstanding performance of Jewellery Maisons” Cartier and Van Cleef & Arpels.
Industry majors LVMH and Kering (PA:) have reported rebounding sales in the first three months of 2021 – equivalent to Richemont’s final quarter – as easing COVID-19 restrictions boosted sales in China and the United States.
Richemont proposed a dividend of 2 Swiss francs per A share for fiscal 2020, after halving it to one franc amid the pandemic last year.
($1 = 0.8175 euros)
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