Luxury retail group Richemont says third quarter sales were down 12 per cent in Asia Pacific, on a constant currency basis.
The company says worldwide sales in the quarter to December 31 were flat, with growth in Europe, the Middle East and the Americas offset by a significant decline in Asia Pacific.
Swiss based Richemont is the world’s second largest luxury brand company and parent of the Dunhill, Cartier, Jaeger-LeCoultre, Montblanc, and Van Cleef & Arpels brands, along with online store Net-a-Porter.
In Asia Pacific, it was Hong Kong and Macau which performed the worst, with the Chinese government’s clampdown on gift giving, falling tourist numbers and the Occupy Central Protests all weakening consumer spending.
Overall, Richemont’s third quarter trading was below the first six months of the year.
“In Asia Pacific, the decline in sales reflected an unfavourable basis of comparison and a difficult trading environment in most markets, primarily in Hong Kong and Macau,” the company said in a trading announcement.
“Soft domestic demand in Japan partly reflected the continued impact of the surge in purchases made ahead of the April 2014 sales tax increase. That surge led to a 47 per cent sales increase in the final quarter of the comparative financial year.”
In Europe, sales benefitted from strong domestic sales and a return of visitors in the main tourist destinations, helped by favourable exchange rates. The Americas region continued to report good growth, albeit at a slower pace than in the first six-month period.
Sales were particularly driven by jewellery and the Net-a-Porter Group, Richemont said.
“The period’s overall performance reflected demand for jewellery, particularly through the retail channel.
“The Jewellery Maisons reported satisfactory sales growth in their own boutique networks. The retail network performance benefitted from jewellery sales in particular.”
Richemont said the decline in sales by the group’s specialist watchmakers reflected both caution on the part of business partners in the wholesale channel and a lower performance of some retail locations, most notably in Hong Kong and Macau.