Richemont's sales slump 47% in first quarter as pandemic, store closures cut demand

Pedestrians walk past luxury goods conglomerate Cartier's store at the Shanghai Hongqiao International Airport in China.
Pedestrians walk past luxury goods conglomerate Cartier's store at the Shanghai Hongqiao International Airport in China.
Alex Tai/SOPA Images/LightRocket via Getty Images

Luxury goods group Richemont [JSE:CFR] saw its first quarter sales plummet to almost half due to the effects of Covid-19.

The group, founded by Johann Rupert, reported in a trading update on Thursday that sales for the quarter ended June 30 fell 47% to €1.99 billion (about R38 billion at current exchange rates) from €3.74 billion (R71 billion) the year before.

Its shares fell almost 5% on the JSE in early trade. 

The owner of Cartier and Montblanc said the the slump was caused by widespread closures of stores and fulfilment centres due to the pandemic. 

While sales contracted across all regions, the Asia Pacific sector fared better than others due to a 47% sales increase in China. Sales in the Americas contracted by 61%, while sales in Africa and the Middle East fell 38%. 

As of June 30, the group said that all its all distribution centres and most stores were open again, with the exception of the Americas region and in travel retail.

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