By Andrea Figueras

Cartier owner Richemont is scheduled to report results for the first half of its fiscal year on Friday. Here is what you need to know:

SALES FORECAST: For its second quarter, which goes from June to September, the Swiss luxury group is expected to book sales of 4.95 billion euros($5.31 billion), slightly higher on year from 4.9 billion euros it made in the prior-year period, according to a poll of estimates by 17 analysts compiled by Visible Alpha. For the first six months to September, the company should post sales of 10.21 billion euros, according to the same consensus. In the year-earlier period, the company reported sales of 10.22 billion euros.

NET PROFIT: Analysts estimate net profit for the first half of 1.91 billion euros, compared with 1.51 billion euros in the year-earlier period, according to Visible Alpha.

Shares in Richemont have jumped roughly 8.1% since the start of the year and are up about 13% over the past 12 months.

WHAT TO WATCH

--PERFORMANCE BY DIVISIONS: Compared to most of its rivals, Richemont has been able to deliver a strong performance in the U.S., which has helped its key jewelry business to overtake LVMH's fashion and leather goods division in sales growth, Deutsche Bank analyst Adam Cochrane wrote in a note. LVMH, the French luxury empire that owns brands such as Dior and Louis Vuitton is considered a bellwether for the sector as a whole. Richemont's watches division has been much weaker, Cochrane said, which reflects continuing weakness in China, one of the most important markets for high-end goods where the majority of luxury brands are facing difficulties.

--HIGH-END CONSUMERS: Richemont is among the luxury companies that cater to the most affluent consumers, making it one of the best performers in the sector. Brands exposed to less well-heeled clientele face more challenges, as these buyers are less resilient in times of economic slowdown and have reduced their luxury purchases. "The higher average price point of the Richemont offer, particularly in jewelry, is likely to see less impact from the weakness in the aspirational luxury consumer," Deutsche Bank said.

--YNAP DEAL: The Swiss group agreed to sell its e-commerce business Yoox Net-A-Porter to luxury online platform Mytheresa, offloading the loss-making business nearly a year after a deal with Farfetch failed to materialize. The deal was seen as a small positive for Richemont by Barclays analysts, since the company had been trying to find a buyer for its remaining YNAP stake for a while. "The corporate structure has been improved with the upcoming disposal of YNAP," DB's Cochrane said.

Write to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

November 07, 2024 07:16 ET (12:16 GMT)

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