luxury

Swiss firm Richemont reports all-time high sales of €20 bn in FY23

Published: May 16, 2023
Author: Fashion Value Chain

-By Mansi Suryavanshi

INSIGHTS 

  • Richemont’s FY23 revenues reached a record €20 billion, up 19% YoY, led by growth in the Asia Pacific. Operating profit increased 34% to €5 billion, with a margin of 25.2%.
  • While the other category saw a return to profitability, directly run stores and internet sales took the lead.
  • 301 million euros was the maximum overall profit attributable to ceased activities.

A luxury goods business called Richemont with headquarters in Switzerland reported record-breaking revenues of €20 billion in the FY23 period. As the Asia Pacific area resumed growing following the removal of travel and health restrictions in mainland China, this represents a 19% year-over-year (YoY) rise. This gain was primarily driven by a large sales spike in the final quarter. 

In FY23, directly controlled stores did better than other distribution channels, accounting for 68% of the group’s revenues, while online and store sales combined made up roughly 75% of the total. Sales increased by 6% at real rates (up 1% at constant exchange rates) as the Asia Pacific region’s growth accelerated. According to the company’s media release, other areas, headed by Japan and Europe, had double-digit growth both at real and constant currency rates.

The other business division of Richemont, which is mostly made up of fashion and accessory maisons, recorded sales of €2.7 billion in FY23, an increase of 19% from the previous year. The fashion and accessory maisons contributed €94 million in operating profit to the segment’s return to profitability.

Operating profit for the business hit a new high of €5 billion in FY23, while operating margin increased to 25.2% of sales. Strong €4.5 billion cash flow from operational operations was produced by this significant 34% expansion in operating profit and well-managed working capital. Profit from ongoing operations for the year climbed by 60% to €3.9 billion. However, the €3.6 billion loss from terminated activities for the year kept the overall profit for the year to a maximum of €301 million. 

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