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Swiss luxury group Richemont is a core holding in JSE-share portfolios. As Michael pointed out here recently, the stock has been on a nice run to above R200 a share.
Richemont shares rose another 10% on Friday after it published forecast-beating results. Group sales rose 65% at constant currencies to EUR8.9 billion, ahead of analyst consensus of EUR8.5 billion.
Management also revealed that they are in "advanced talks" with online retailer Farfetch and other companies over a deal to invest in its lossmaking Yoox Net-a-Porter e-commerce business.
Activist funds are circling Richemont, but the Rupert family owns 9.1% of the shares and controls 50% of the voting rights under a dual-class share structure. On a call with reporters last week, Johann Rupert said, "Richemont is not for sale and we are not interested in merging. We believe in our own businesses."
The heart of this group is the jewellery brands Cartier and Van Cleef & Arpels. After years of monitoring the luxury goods industry, I can say this with confidence: never underestimate the spending power of the really rich.
