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It is always nice for a company to release positive results on a day when the general market is surging. That's what happened to Richemont last week Friday and the stock closed up 13%. Group sales increased 24% for the 6 month period to 9.67 billion Euros while profits from continuing operations increased 40%.
China was still in a strict lockdown over the period but the rest of Asia Pacific has opened up. This means there is even more upside potential once China finally gives up on trying to contain the Omicron variant.
Jewellery sales were especially impressive. Revenue in that division increased by 24% with Cartier's Clash and Trinity rings and necklaces proving very popular (see picture below).
Richemont is a well-managed business. They have had a few hiccups with their online adventures but the YNAP write-down has passed through the numbers and it is time for the group to move forward as a minority shareholder of a bigger business.
The very rich are mostly unaffected by tough economic conditions. They don't even notice recessions. Richemont is a must-own in your local portfolio. We feel this one has plenty of upside.
