| Wed 16 Jul 2008, 8:20 | | RCH - Richemont Securities AG - Management Statement For The Three Months Ended |
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RCH
RCH
RCH - Richemont Securities AG - Management Statement For The Three Months Ended
30 June 2008
Richemont Securities AG
(Incorporated in Switzerland)
Share code: RCH
ISIN: CH0013157380
("Richemont")
MANAGEMENT STATEMENT FOR THE THREE MONTHS ENDED 30 JUNE 2008
Richemont presents its management statement for the first three months of its
current financial year.
April- April- Movement at
June June
2008 2007 Constant Actual
Euro m Euro m rates(1) rates(1)
Jewellery Maisons 737 638 + 25 % + 16 %
Specialist watchmakers 415 367 + 19 % + 13 %
Writing instrument 140 140 + 5 % + 0 %
Maisons
Leather and accessories 61 62 + 5 % - 2 %
Maisons
Other businesses 75 61 + 28 % + 23 %
Total sales 1 428 1 268 + 20 % + 13 %
Interim Management Statement
This statement is intended to provide investors with an overview of trading
performance and any significant developments in the Group, not full quarterly
financial reporting. Accordingly, no figures in respect of operating or
attributable profit are provided in this report. Equally, no commentary is given
here on the performance of the Group`s principal associated company, British
American Tobacco plc.
The first quarter of the Group`s financial year should not necessarily be taken
as indicative of likely trends for the financial year as a whole; a large part
of the Group`s business is transacted in the quarter to 31 December each year.
The quarter to 30 June, whilst typically representing between 20 and 25 per cent
of the Group`s annual sales, may not be representative of trends for subsequent
quarters or the year as a whole.
The information contained in this report has not been audited.
Overview
In the first three months of the financial year, overall sales grew by 13 per
cent at actual exchange rates, reflecting a continuation of the strong demand
seen during the preceding twelve months. Underlying sales growth in the three
month period was 20 per cent.
Jewellery Maisons
The Group`s Jewellery Maisons - Cartier and Van Cleef & Arpels - reported very
strong growth during the period. With the exception of Japan, where sales saw a
mid-single digit decrease, all regions reported double-digit growth at constant
exchange rates.
Specialist watchmakers
The Group`s seven specialist watchmakers continued to benefit from strong demand
in all regions other than Japan.
Writing instrument Maisons
Sales grew by 5 per cent at constant rates. Strong sales growth through
Montblanc`s own boutique network was offset by wholesale sales in line with the
prior year`s level, largely due to logistics issues at Montblanc`s new
distribution facility.
Leather and accessories Maisons
Alfred Dunhill reported sales growth of 6 per cent at constant exchange rates
during the period, with strong sales growth in the Asia-Pacific region partly
offset by lower sales in Japan. Lancel`s sales were 4 per cent above the prior
year at constant exchange rates.
Other businesses
Chloe`s sales saw a mid-single digit decrease at constant exchange rates,
reflecting lower retail sales. The increase in sales of other businesses overall
included the impact of acquisitions made during the previous financial year.
Sales by geographic region
April-June April-June Movement at
2008 2007 Constant Actual
Euro m Euro m rates rates
Europe 651 555 + 20 % + 17 %
Asia-Pacific 353 291 + 35 % + 21 %
Americas 271 256 + 20 % + 6 %
Japan 153 166 - 7 % - 8 %
Total sales 1 428 1 268 + 20 % + 13 %
Europe
The 17 per cent increase at actual exchange rates reflects continuing sales
growth in the region`s established markets as well as very strong sales growth
in the Middle East and other developing markets.
Asia-Pacific
This region continued to report very strong growth, particularly in China and
Hong Kong. Sales in the region represented 25 per cent of Group turnover in the
quarter.
Americas
Underlying sales in the Americas region grew by 20 per cent, reflecting strong
retail sales growth of 19 per cent. The growth in dollar-terms was largely
offset on translation into euros.
Japan
The challenging market conditions in Japan, which have impacted luxury
businesses generally, continued during the quarter, with most Maisons reporting
lower turnover. Sales in yen terms decreased by 7 per cent. Sales in Japan now
represent 11 per cent of total Group sales.
Sales by distribution channel
At actual exchange rates, the Group`s retail sales increased by 14 per cent
whilst wholesale sales increased by 12 per cent.
Financial position
The Group`s net cash position at 30 June 2008 amounted to Euro 1 290 million, an
increase of Euro 44 million over the net position at 31 March 2008.
During the three month period the Group received the final dividend of GBP 186
million from British American Tobacco in respect of its financial year ended 31
December 2007. This inflow was compensated by seasonal net cash outflows in
respect of operations together with the exercise of a call option to acquire 1.7
million Richemont `A` units to hedge the Group`s stock option plan.
British American Tobacco
The Group`s effective interest in British American Tobacco (`BAT`) at 30 June
2008 was 19.4 per cent. Based on the market price of ordinary shares on that
date, the market value of the Group`s interest in BAT amounted to Euro 8 566
million. Richemont equity accounts its interest in BAT; accordingly, the Group
does not include turnover reported by BAT in its sales figures.
Restructuring proposals
On 22 May, Richemont announced further details of its restructuring proposals
which would see the Group separated into two entities: a luxury business,
headquartered in Switzerland, and a separate investment vehicle. In addition to
retaining their shares in the luxury goods business, it is envisaged that
Richemont unitholders would receive shares in the investment vehicle and would
be able to receive a substantial part of their interest in the BAT shares
directly.
Further announcements in respect of the restructuring proposals will be made
when appropriate. No further comment will be made until such time.
Press inquiries: Mr Alan Grieve, Director of Corporate Affairs
Tel: + 41 22 721 3507
Analysts` inquiries: Ms Sophie Cagnard, Head of Investor Relations
Tel: + 33 1 5818 2597
Appendix 1
Foreign exchange rates
April-June April-June
Average rates against the 2008 2007
euro
United States dollar 1.56 1.35
Japanese yen 163.38 162.87
Swiss franc 1.61 1.65
Pound sterling 0.79 0.68
Actual exchange rates for the period are calculated using the average daily
closing rates against the euro.
In terms of sales at constant exchange rates, average exchange rates for the
year ended 31 March 2008 are used to convert local currency sales into euros for
both the current three-month period and comparative figures. Exchange rate
translation effects are thereby eliminated from the sales comparison at constant
rates.
Richemont press release dated 16 July 2008
Notes for editors
Richemont owns a portfolio of leading international brands or `Maisons`, which
are managed independently of one another, recognising their individuality and
uniqueness. The businesses operate in five areas: Jewellery Maisons, being
Cartier and Van Cleef & Arpels; Specialist watchmakers, which is made up of
Jaeger-LeCoultre, Piaget, IWC, Baume & Mercier, Vacheron Constantin, Officine
Panerai and A. Lange & Sohne; Writing instrument Maisons, being Montblanc and
Montegrappa; Leather and accessories Maisons, being Alfred Dunhill and Lancel;
and Other businesses, which includes, specifically, Chloe as well as other
smaller Maisons and watch component manufacturing activities for third parties.
In addition to its luxury goods business, Richemont holds a 19.4 per cent
interest in British American Tobacco. Richemont equity accounts its interest in
British American Tobacco; accordingly, the Group does not include turnover
reported by British American Tobacco in its sales figures.
16 JULY 2008
Date: 16/07/2008 08:20:45 Produced by the JSE SENS Department.
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