Business

Richemont luxury goods business hit by Paris attacks

Cartier watches Image copyright PA
Image caption Luxury watch sales have been falling in Asia

Richemont, the owners of Cartier, saw sales fall 4% during the crucial gift-giving October to December months.

The world's second-biggest luxury goods group has been hit by the economic slowdown in Asia and in Europe.

The company said trade had been severely affected by the Paris terror attacks on 13 November in which 130 people died. France accounts for 8% of global sales.

Richemont said that the market in Asia remained "challenging".

Sales were down 9% in Asia and 3% in Europe. Overall, they fell 4% to €2.9bn (£2.2bn; $3.2bn).

Richemont, which owns global brands such as Montblanc, Van Cleef & Arpels and Piaget, has also been hit by currency fluctuations.

Image copyright Getty Images
Image caption Montblanc, famous for its expensive pens, has also suffered

The Geneva-listed company, owned by South African businessman Johann Rupert, said sales were below expectations. The company said it expected the "challenging trading environment" to continue to the end of the financial year, which ends on 31 March.

Watches woe

Asia has in recent years been the driver for many in the luxury goods market.

Richemont said Japan bucked the trend with a 9% rise in sales, but Hong Kong and Macao saw a marked slowdown.

Hong Kong is the top market for Swiss watches, but exports to the territory were down 28% in November.

The company said conditions in mainland China were improving, but tough anti-bribery rules had affected expensive gift-giving among the business community. Sales of luxury watches, in particular, had been hit.

Terror attacks across Europe had kept shoppers and tourists away. Sales in the region took a sudden downturn, falling 3% in the last quarter compared with a year ago. Paris was particularly affected following the attacks in November.

Richemont's share price, which last year slumped 19% over concerns of a slowdown in the Chinese economy, has fallen a further 9% since the start of this year.

More on this story