(Adds detail, background, analyst comment)
ZURICH, May 21 (Reuters) - Cartier maker Richemont
proposed to double its dividend on Friday after net profit rose
by a third in its fiscal year 2020/21, helped by a strong
performance of its jewellery brands and as it benefited from net
finance income.
Luxury watch sales have been recovering recently from the
severe pandemic hit, with Richemont, the global No.2 in luxury
goods, faring better than rival Swatch Group thanks to
its exposure to the fast-growing jewellery category.
Richemont did not give an outlook for the year, but Chairman
and controlling shareholder Johann Rupert cautioned in a
statement that "volatility and low visibility are likely to
prevail until there is herd immunity" against COVID-19.
Net profit at Geneva-based Richemont rose by 38% to 1.289
billion euros ($1.58 billion) in the group's fiscal year to
March, ahead of a forecast for 821 million euros in a Refinitiv
poll.
Sales fell 5% at constant exchange rates and 8% at actual
rates to 13.14 billion euros, also beating the 13.02 billion
estimate in the poll thanks to a strong recovery in the final
quarter.
Bernstein analyst Luca Solca said the results were a "strong
beat to consensus, built on the outstanding performance of
Jewellery Maisons" Cartier and Van Cleef & Arpels.
Industry majors LVMH and Kering have
reported rebounding sales in the first three months of 2021 -
equivalent to Richemont's final quarter - as easing COVID-19
restrictions boosted sales in China and the United States.
Richemont proposed a dividend of 2 Swiss francs per A share
for fiscal 2020, after halving it to one franc amid the pandemic
last year.
($1 = 0.8175 euros)
(Reporting by Silke Koltrowitz, editing by John Miller)