- Revenue for 2023 reached an all-time high of €19.95 billion, up 19% at actual exchange rates and 14% at constant exchange rates. The operating profit increased by 34% to €5 billion, with the operating margin increasing to 25.2% from 22.4%.
- Significantly, the company increased the ordinary dividend by 11% to CHF 2.50 per share and declared a special dividend of CHF 1.00 per share. Over the last decade, the ordinary dividend has now increased by a compound annual growth rate (CAGR) of 9.6%.
- Sales growth was recorded across all regions, distribution channels, and business areas, at actual and constant exchange rates. Richemont’s largest region, Asia Pacific, resumed growth with revenue growing by 6% to €7.9 billion, accounting for 40% of total sales. Japan and Europe were the fastest-growing regions, with revenue increasing by 45% (€1.61 billion) and 30% (€4.37 billion) respectively. The Americas, the second-largest region, reported sales growth of 14% to €4.47 billion.
- Jewelry generated 21% sales growth and a 35% operating margin, while Specialist Watchmakers achieved a 13% sales growth and a 19% operating margin.
- Richemont currently trades on a free cash flow yield of 4.5%, which we believe is fair for a company of such brand and financial quality. Richemont has also increased its dividend by a CAGR of 10% over the last decade. Given this fair valuation coupled with the potential for ongoing earnings and dividend growth, we remain confident in holding Richemont for the long run.
By Desmond Esakov