Cartier warns of luxury slowdown
The owner of the brand says sales growth missed forecasts, singling out China as a particular problem, and gives a cautious outlook.
Apparently some of the rich are taking a step back from conspicuous consumption, with the owner of the Cartier and Montblanc brands giving a cautious outlook after reporting disappointing sales growth.
The downbeat report from Cie. Financiere Richemont SA (CFR) comes after other luxury goods makers reported disappointing results. Shares of Tiffany (TIF) took a dive earlier this month after disclosing ho-hum holiday sales and cutting its earnings outlook.
Richemont, based in Geneva, Switzerland, said sales rose 9% during the past three months of 2012 -- down from a 24% jump a year earlier. With demand for luxury items such as Cartier's $53,200 diamond-studded panther necklace slowing, the sales numbers missed analysts' expectations.
The culprit doesn't appear to be America's 1%, however. Richemont blamed a slowdown in Asia, and singled out China as a particular problem.
"At this stage, it is unclear how business patterns may develop and how the business in the Asia Pacific region will evolve in the near future," the company said in a statement.
Luxury sales might improve along with China's fortunes, however. The country's economic growth recently accelerated for the first time in two years, according to Bloomberg, citing data released by Beijing's National Bureau of Statistics.
But the Chinese are also getting more discerning, and not all diamond-studded products are going to wow consumers there the way they used to, Neev Capital founder Rahul Sharma told CNBC.com.
"It used to be that you just put up a store in China and you won, now the Chinese consumers themselves are being quite choosy in terms of the brands they like -- they like iconic stuff," he said.
More on moneyNOW
Copyright © 2013 Microsoft. All rights reserved.
Quotes are real-time for NASDAQ, NYSE and AMEX. See delay times for other exchanges.
Fundamental company data and historical chart data provided by Thomson Reuters (click for restrictions). Real-time quotes provided by BATS Exchange. Real-time index quotes and delayed quotes supplied by Interactive Data Real-Time Services. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by SIX Financial Information.
Like rival Wal-Mart, it's pointing the finger elsewhere for its problems while other retailers are coping just fine.
- Chick-fil-A thrown back into gay marriage debate
- Oklahoma tornado losses could top $2 billion
- Apple's stock is slipping, but its brand value isn't
- Meet the class of 2013, the most indebted yet
- Is Abercrombie just for the 'cool kids'?
- McDonald's unveils its highest-calorie item ever
- How Samsung could save Best Buy
- Is the new Xbox Steve Jobs' dream device?
- What if corporations paid no taxes?
[BRIEFING.COM] The S&P 500 settled lower by 0.8% after early strength turned into afternoon weakness.
Today's headline event came in the form of Ben Bernanke's testimony before the Joint Economic Committee. During his remarks, Chairman Bernanke said premature tightening of monetary policy could stall the pace of recovery. This followed weeks of conflicting remarks from FOMC members, which sparked speculation regarding possible changes to the Fed's policy course.
However, ... More
More Market News
The market's cheap money addiction is laid bare. No one knows how it will end.