Shoppers snapping up luxury looks while sitting on the sofa each evening have helped online fashion site Net-a-Porter match the sales growth of some of its stablemates at designer brands giant Richemont.
Despite recession in many of its markets, Richemont saw the global appetite for upmarket clothes, jewellery and watches show no signs of waning with a forecast-beating 43% rise in net profits.
Richemont, which is the world’s second-largest luxury goods group behind Paris-based LVMH, is “cautiously optimistic” despite the unstable economic environment.
Growth is so buoyant its South African owners, the Rupert family, announced a share buyback.
Chairman and chief executive Johann Rupert will buy back up to 10 million of its A shares through the market over the next two years, representing 1.7% of its capital.
Profit for the year to the end of March hit €1.54 billion (£1.23 billion). But sales growth had slowed slightly with an April sales rise of 29%, down on the 32% rate of a year earlier. China and Asia continue to be a big growth area for luxury goods groups, and Richemont saw sales in Asia-Pacific shoot up 46%. The area now makes up 42% of group sales.
The group will continue to open new stores for its brands and in London Cartier will re-open its second Bond Street store.
Richemont’s network of 948 boutiques and shops and its Net-a-Porter online sites now account for more than half of group sales, outpacing the rate of growth for the wholesale arm of the business. It will open shops with a focus on tourist destinations including London and Paris as well as more stores across Asia.
The shares, up 5.25% today, have gained 12% in value since the start of the year. Despite the strong growth, Rupert admitted he is “mindful of the unstable economic environment, particularly in the eurozone”.
