Luxury Strength: Richemont Delivers a Powerful Earnings Beat, CFR Share Price JSE Tests Records
Richemont delivered an impressively strong first-half performance, surpassing expectations across every division and region despite a...
Quick overview
- Richemont reported a strong first-half performance with a 14% constant-currency sales growth, reaching €5.2 billion in Q2 of fiscal 2026.
- The jewellery division led the growth with a remarkable 17% increase, surpassing market expectations.
- Despite global economic challenges, Richemont's shares soared close to record highs, reflecting positive market sentiment.
- The company's Jewellery Maisons effectively managed costs and pricing, resulting in a robust operating profit of €2.5 billion.
Richemont delivered an impressively strong first-half performance, surpassing expectations across every division and region despite a challenging global environment.
Richemont’s Strong H1: A Broad Earnings Beat Across the Board
Richemont reported a standout set of first-half results, significantly outperforming consensus and reaffirming its position as one of the most resilient luxury groups globally. Despite elevated gold prices and persistent macroeconomic uncertainty, the company posted 14% constant-currency sales growth, reaching €5.2 billion in Q2 of fiscal 2026. The jewellery division—long the group’s growth engine—led the way with an exceptional 17% increase, well above the 10% market expectation.
The strength was broad-based, with every region and every business unit contributing to the upside surprise.
Market Reaction: Share Price Approaches Record Highs
Richemont’s Johannesburg-listed shares (JSE: CFR) reacted sharply, soaring to R3,782, close to the all-time highs reached in Q1 2025. Although the stock eased slightly to close at R3,658, the technical picture remains constructive. The share continues to find solid support at the 20-day SMA, suggesting that a fresh breakout to new highs may only be a matter of time.
Chairman’s Words: Strength Amid Complexity
Management described the performance as “solid” given the persistent geopolitical uncertainties and cost pressures affecting luxury markets globally. Sales for the first six months reached €10.6 billion, rising 10% at constant FX (+5% at actual rates). Momentum accelerated meaningfully in Q2, with double-digit constant-currency growth in every region, demonstrating the durability of the group’s multi-engine strategy.
Regional trends remained encouraging:
- Europe, the Americas, and the Middle East all delivered robust double-digit gains.
- China, Hong Kong, Macau, and Japan returned to growth in Q2 after periods of uneven demand.
- Distribution remained balanced, with direct-to-client sales making up 76% of total revenue.
Jewellery Maisons: The Powerhouse Behind Richemont’s Outperformance
The group’s Jewellery Maisons—Buccellati, Cartier, Van Cleef & Arpels, and Vhernier—once again proved to be Richemont’s strongest pillar of growth. Sales rose 9% at actual FX, and 14% at constant FX, with Q2 alone delivering a remarkable 17% surge. Jewellery and watch collections saw broad demand across all key markets.
Despite:
- Sharp currency fluctuations
- Higher raw material costs
- Initial effects of additional U.S. duties
…the Maisons effectively protected margins through measured price adjustments and disciplined cost control.
This allowed them to generate a robust €2.5 billion operating result, up 9% at actual rates and 21% on a constant-currency basis, with an impressive 32.8% operating margin.
Richemont H1 Interim Results: Key Figures at a Glance
Sales Performance
- Sales: €10,619m (2025) vs. €10,077m (2024)
- Change: +5%, driven by steady demand across core luxury segments
Profitability Metrics
- Gross Profit: €6,939m (2025) vs. €6,771m (2024)
- Change: +2%
- Gross Margin: 65.3% vs. 67.2%
- Movement: –190 bps, reflecting slightly higher cost pressures
Operating Performance
- Operating Profit: €2,358m (2025) vs. €2,206m (2024)
- Increase: +7%
- Operating Margin: 22.2% vs. 21.9%
- Movement: +30 bps, showing improved operating efficiency
Profit Breakdown
- Profit from Continuing Operations: €1,796m (2025) vs. €1,729m (2024)
- Change: +4%
- Profit/(Loss) from Discontinued Operations: €17m (2025) vs. €(1,272)m (2024)
- Impact: Significant year-on-year improvement due to prior-year write-downs
Total Profit
- Profit for the Period: €1,813m (2025) vs. €457m (2024)
- Sharp Rebound, reflecting both operational growth and normalization of discontinued items
Shareholder Returns
- Diluted EPS (‘A’ share/10 ‘B’ shares): €3.078 (2025) vs. €0.779 (2024)
- Substantial Improvement, aligned with recovery in reported earnings
Cash Flow
- Operating Cash Flow: €1,854m (2025) vs. €1,249m (2024)
- Increase: +€605m, supported by stronger working capital management
Balance Sheet
- Net Cash Position: €6,519m (2025) vs. €6,108m (2024)
- Improvement: Reflects disciplined capital allocation and robust liquidity
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