By Steve Goldstein
Compagnie Financiere Richemont rose as much as 10% after reporting a surge in sales and confirming it's in talks over its loss-making Yoox Net-A-Porter business.
Richemont said fiscal first-half sales climbed 63%, leading to a surge in profit to EUR1.25 billion from EUR159 million. Its profit was up 44% from 2019 levels on a 20% rise in sales.
Richemont said it's in advanced discussions with Farfetch (FTCH) to boost its partnership, that would have it invest into Yoox Net-A-Porter as a minority shareholder, provide technology and invite Richemont into the Farfetch marketplace. There would be other industry players and investors in investing, Richemont said, so that there would be no controlling shareholders.
Farfetch jumped 14% in premarket action.
"H1 results surprised positively on multiple fronts with a solid group sales and EBIT beat, acceleration of sales growth across almost all divisions, a very strong [Jewellery Maisons] margin beat, and the confirmation of discussions with Farfetch and other parties, which could result in a deconsolidation of the loss-making [online distributors] division," said UBS analysts led by Zuzanna Pusz.
Rival Swatch Group rose 3%, and luxury-goods giant LVMH Moet Hennessy added 1%.
The Stoxx Europe 600 rose 0.1% to 485.86 in what's been a steady week for the index.
Of the major regional indexes, the German DAX gained 0.2%, the French CAC 40 increased 0.3% while the U.K. FTSE 100 declined 0.4%.
(END) Dow Jones Newswires
11-12-21 0843ETCopyright (c) 2021 Dow Jones & Company, Inc.