Recession a boost for Richemont

THE recession did not stop the super-rich from treating loved ones to opulent items such as Cartier watches over Christmas, luxury retail giant Richemont said yesterday as it posted forecast-beating sales.

The world's second-largest luxury goods manufacturer, which also makes Chloe handbags, said the surprise rise had been driven by booming sales in the Asia- Pacific region, where sales grew 25 per cent during the quarter.

Overall, sales grew 2 per cent, or 7 per cent at constant exchange rates, to 1.59 billion (1.4bn) during the third quarter of Richemont's financial year, which beat even the highest analyst forecasts. Richemont said: "The improvement in trading is welcome in the context of a generally difficult economic environment."

Shoppers in Japan have long been known for their taste for the expensive, but analysts said Asia-Pacific growth is now primarily driven by its neighbour China.

Jon Cox, an analyst at Kelper Capital Markets, said: "Forget Japan, China is the new driver of the luxury goods industry."

Cox said demand for luxury watches was particularly fierce. "The recession is over for the watch industry," he said.

Citi analyst Thomas Chauvet said Richemont was likely to emerge as one of the surprise winners of the global recession.

He said: "Richemont could emerge from the recessionary cycle in a much stronger competitive position."