FY 2022
- Richemont reported a 46% increase in revenues of €19.2 billion, with double-digit rate increases recorded across all business areas, regions and channels.
- Operating profit more than doubled to €3.4 billion, delivering an improved operating margin of 17.7%. This improvement was driven by Jewellery Maisons with 49% sales growth and a 34.3% operating margin, as well as Specialist Watchmakers growing by 53% with a 17.3% operating margin.
- Richemont generated just over $3 billion in free cash flow which saw the board propose a dividend of CHF 2.25 per share (2021 CHF 2.00) as well a special dividend of CHF 1.00 per share. Excluding the special dividend, Richemont has now increased its dividend by a compound annual growth rate of 15% over the last decade.
- Despite the impressive results, shares dropped by close to 10% on a cautious outlook over China as well as the failure to provide any meaningful feedback in the long-running talks about the potential sale of its loss-making online retail business YOOX Net-a-Porter.
- Richemont currently trades on a free cash flow yield of 6%, which we believe is fair for a company of such brand and financial quality. Clients who are prepared to sit out the current turbulence should be well rewarded over the next decade. I found the presentation by the Chairman Johann Rupert to be most insightful and candid and would highly recommend watching.