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UPDATE 3-Richemont H1 shines as Asians splash out on Cartier

By Silke Koltrowitz ZURICH, Nov 12 (Reuters) - Cartier watchmaker Richemont's first-half profit soared more than expected as buoyant demand for top-of-the-range watches and jewellery in Asia and the Americas fuelled the brisk pace of growth into October. Luxury groups have seen sales rebound strongly from their worst slump in decades and Swiss watch exports have soared this year, with Hong Kong, where mainland Chinese love to shop, still the prime export destination for Swiss watches. April-September sales at Richemont rose 37 percent, helped by a weak euro, driven in particular by Asian consumers spending on Cartier and Piaget watches, Van Cleef & Arpels jewellery and Montblanc pens. "A blow-out set of figures," Kepler Capital Markets Jon Cox said, adding that the improved gross margin and the sales acceleration in October were also positive. Net profit almost doubled thanks to a revaluation gain on recently acquired online fashion retailer Net-a-porter, beating estimates in a Reuters poll. Shares pared earlier losses, rising 4.8 percent to 53.85 Swiss francs at 1119 GMT, while nearly all of its peers in the STOXX Europe 600 Personal goods and household index fell or remained flat. Richemont shares have risen 50 percent this year, outperforming a 25 percent rise in the sector. CHRISTMAS The high rate of growth observed in the first seven months of Richemont's fiscal year, running to the end of March, was now set to slow during the coming months due to exchange rate movements and more challenging comparatives, the group said. "It is too early to say what November and Christmas will look like. There is clearly a feel-good factor at the moment but that could disappear at any time," Chief Financial Officer Gary Saage said at a conference call, confirming the group wanted to increase its dividend year by year. Saage said the group remained focused on organic growth, and Asia was the region with the highest growth potential. Analysts at bank Wegelin said that the future looked bright for the luxury industry. "Demand for luxury items is strong with no reversal of this trend in sight thanks to growing wealth in emerging markets and a certain need to catch up in developed markets," they said in a note. "It is obvious that current strong growth rates cannot be maintained forever, which explains the rather cautious outlook," they said. Leather goods maker Hermes and the world's biggest luxury group LVMH, which recently bought a 17 percent stake in Hermes, both shied away from giving an outlook for next year when posting solid third-quarter results and expressing optimism for the rest of 2010. Richemont, controlled by South Africa's Rupert family, trades at around 18 times estimated March 2012 earnings, a similar level to Swatch Group for estimated 2011 earnings but a slight discount to LVMH at around 20 times. (Editing by Dan Lalor, Mike Nesbit) ($1= 0.7253 euros) Keywords: RICHEMONT/ (Zurich Newsroom +41 58 306 7336, zurich.newsroom@news.reuters.com) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved.

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