© Reuters. FILE PHOTO: Jewellery is displayed at a Cartier store on Place Vendome in Paris, France, July 2, 2019. REUTERS/Regis Duvignau/File Photo/File Photo
ZURICH (Reuters) -Richemont reported weaker-than-expected earnings on Friday as the Cartier jewellery owner became the latest luxury company to highlight increased caution by big-spending customers.
The owner of Swiss watch brands including Piaget and IWC posted a profit of 1.51 billion euros ($1.61 billion)for the six months to the end of September, worse than the 2.17 billion euros forecast by analysts in a consensus cited by Zuercher Kantonalbank.
Sales rose 6% to 10.22 billion euros from 9.68 billion euros a year earlier, below the 10.34 billion euros expected by analysts.
For the second quarter, to the end of September, sales at constant foreign exchange rates were up 5%, despite slowdown in Europe with sales of jewellery labels up 9% at constant foreign exchange rates while watches sales were down 4%.
This compared to 3% organic growth from rival LVMH’s watches and jewellery division over its third quarter, which covered the July-to-September period.
“Growth eased in the second quarter as inflationary pressure, slowing economic growth and geopolitical tensions began to affect customer sentiment, compounded by strong comparatives,” said Chairman Johann Rupert in a statement.
“Consequently, we have seen a broad-based normalisation of market growth expectations across the industry.”
($1 = 0.9375 euros)