(IDEX Online News) – Luxury group Richemont SA, the owner of brands such as Cartier and Van Cleef and Arpels jewelry as well as IWC watches, said fiscal year net income rose around 30 percent with the dollar’s strength against the euro boosting sales growth.

That would be the equivalent of around 2 billion euros ($2.6 billion), ahead of analysts' average forecast a rise of 25 percent, or 1.93 billion euros, according to Thomson Reuters data.

Richemont will release its full results for the year ended March 31 on May 16.

The company said reported sales would soar around 14 percent for the year, while the increase in operating profit would be about 18 percent. That would mean sales of just over 10 billion euros ($13 billion), compared with analysts' average forecast of 10.15 billion euros, and operating profit of about 2.41 billion euros ($3.14 billion), versus an average forecast of 2.4 billion euros.

 

Currency changes, including the dollar’s strength versus the euro, led to a sales growth of 5 percentage points, and helping offset weaker demand for Swiss watches.

 

Analysts said there was a clear slowdown in demand from China for watches, a sector where Richemont is particularly exposed.

 

Japan excluded, the Asia-Pacific region accounts for more than 40 percent of Richemont's annual sales.

 

Meanwhile, new figures showed Swiss watch exports dropped 5.4 percent in March, a slight improvement on the 7.1 percent plunge the month before when sales to large markets such as Hong Kong and China recorded double-digit falls.

 

Richemont did not give details regarding its fourth quarter performance, saying it released full-year, headline numbers simply to stay in line with market rules about keeping investors informed about large changes in results compared with the previous year.

 

The dollar was, on average, 6.9 percent stronger against the euro during Richemont's fiscal year. The Geneva-based company made the announcement regarding net income due to Swiss stock exchange rules that require doing so when results differ strongly from the previous year.