Despite revenue rising, Bulgari’s profit is down, and it has been moved from ‘neutral’ to ‘underweight’ by JPMorgan Chase & Co. Bulgari SpA (BUL IM) dropped 4.8 per cent to 7.10 euros, over the weekend- the largest drop in 8 months. Bulgari is the world’s third largest jeweller, and we find this drop surprising, given the recent overall recovery of the luxury industry. Rivals like Tiffany & Co. are experiencing enormous growth as of late, riding on China’s growth as a luxury market. The popularity of diamonds with Chinese brides has been a contributing factor.Bulgari’s third quarter income was 16.6 million euros ($23.23 million AUD), falling short of the average 19.8 million euro average analyst estimate in a Bloomberg survey. Geographically, Bulgari’s sales were varied geographically. Sales rose by 11 per cent in Europe and dropped 7 per cent in the USA. Sales fell 1 per cent in Japan, increased 15 per cent across Asia as a whole and fell 2 per cent in the Middle East. Sales rose 24 per cent in greater China, which is not surprising.
Despite financial inconsistencies, Bulgari shows promise to pick its stock-self back up again, with new product launches, and exciting campaigns. The new Julianne Moore campaign certainly got us very excited. Fingers crossed for a successful Christmas season!
Image credit:www.greenwichmeantime.com
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