South African billionaire Johann Rupert’s luxury company records over $5.2 billion in revenue in Q1 2023

Richemont, a Swiss luxury goods holding company led by South African billionaire Johann Rupert, is off to a good start after reporting double-digit sales growth at the end of the first quarter of its 2023 fiscal year despite disruptions in its Chinese operations.

Richemont’s total sales in the first quarter of its 2023 fiscal year increased by 20 percent, from €4.4 billion ($4.42 billion) in the corresponding quarter of 2022 to €5.26 billion ($5.28 billion). The bump in sales came off a rebound in demand for watches and jewelry despite the impact of a new wave of lockdowns in China, which hit sales in April and May.

According to figures in its recently published report, the double-digit increase in sales can be attributed to higher sales in the United States, Europe, and Japan in the three months leading up to June, which offset a 37-percent drop in total sales in mainland China due to economic weakness and the impact of store closures.

Unlike its British counterpart, Burberry, Richemont, which operates a diverse portfolio of luxury brands such as Chloe, Dunhill, Alaa, Cartier, and Delvaux, was able to weather the storm in its markets, particularly in Asia-Pacific.

The strong momentum in most other Asian markets, particularly in Australia, Singapore, South Korea, and Thailand, helped to mitigate the region’s sales decline, with sales in the Asia-Pacific contracting by 15 percent.

Sales in the Americas increased by 25 percent despite challenging comparatives with the previous year, driven by strong domestic spending. As a result, the United States was Richemont’s largest single market for the quarter, accounting for 22 percent of group sales.

Richemont achieved impressive sales growth across all channels, with retail posting the strongest relative channel performance of 18 percent, driven by double-digit increases across all business areas and notable performances in Europe, the Americas, and Japan.

Online retail sales, on the other hand, increased by five percent, reflecting slow sales growth at the group’s online distributors and strong growth at its jewelry stores and specialist watchmakers.

Despite the strong financial performance, Richemont shares have fallen 5.7 percent to R165.5 ($9.63) since the opening of the Johannesburg Exchange this morning, bringing the year-to-date decline to more than 30 percent.

The market value of Rupert’s stake in the luxury goods holdings fell below $6.2 billion as a result of the sustained decline in the company’s shares and market capitalization, pushing his net worth below the $9-billion mark.