Richemont reported a six-month operating loss of €0.7 million in its “discontinued operations” unit comprising Yoox Net-a-Porter (YNAP), citing continued losses at the e-commerce group as well as a €0.5 billion additional write-down on the asset.
YNAP, which is set to be spun off in a joint venture with US-listed rival Farfetch, saw its sales fall by 10 percent at constant currency in the six-months from April through September, Richemont said.
The €0.5 billion additional write-down reflects a significant slide in the market capitalisation of Farfetch (which is set to pay for a 47.5 percent stake in YNAP in shares) as well as a reduction in the expected fair value of Richemont’s remaining shares in YNAP. The Swiss luxury group previously announced a €3.4 billion write-down to YNAP’s value in its full-year results.
Richemont’s negative result of €655 million in discontinued operations implied losses of €128 million ($137 million) from YNAP’s operations once the €527 write-down was deducted.
Elsewhere, Richemont said sales grew 12 percent at constant exchange in the first six months of its fiscal year, reflecting a normalisation in luxury demand after a post-pandemic boom. Jewellery sales at the Cartier- and Van Cleef-owner grew by 16 percent, while growth slowed to 3 percent for the specialist watchmakers division including Vacheron Constantin, IWC, and Jaeger-LeCoultre.
At YNAP, the gloomy results and additional write-down suggest continued declines for multi-brand luxury e-commerce. Farfetch, which is set to report its own quarterly results 29th November, has seen its market value tumble by more than 82 percent over the past 12 months.
Farfetch’s Acquisition of Yoox Net-a-Porter Stake Gets EU Approval
The complex agreement would see the luxury marketplace eventually take control of its top competitor from current owner Richemont.