On April 1st 2013, at the start of Richemont’s financial year, Johann Rupert will step down as Chief Executive of the group but will retain his role as Executive Chairman. From that date, Richard Lepeu and Bernard Fornas, currently Deputy CEO of Richemont and CEO of Cartier International respectively, will become Joint Chief Executive Officers. This isn’t the first time Johann Rupert has switched roles within the governing bodies of the multinational of which he and his family control almost 10% of the equity and 50% of voting rights.
When Compagnie Financière Richemont was established in 1988, as well as being appointed to the Board, Johann Rupert naturally took the task of steering the luxury giant to success. The same logic prevailed in 2003 when luxury sales hit a bump in the road and Mr Rupert took the wheel again. He was succeeded a year later by Norbert Platt, number one at Montblanc, part of the Richemont group, until ill health forced Mr Platt to resign his position at end 2009. Johann Rupert again stepped up to the plate, reprising for the third time his role as Chief Executive Officer of the world’s second largest luxury group.
Going out on a high note
Analysts have widely applauded this last stint at the head of the group. Over the two financial years ending March 2012, Richemont’s sales rose from EUR 5.18 bn to EUR 8.87 bn. Net profit also jumped from EUR 660 mn to EUR 1.54 bn. The group has reported the same positive figures in its first-half results, with sales climbing 12% while net profit surged 52% to EUR 1.08 bn. With an operating margin of 27%, a record for Richemont, and a net cash position of close to EUR 3 bn, up more than 30% over two years, the company is in fine form.
Granted, Johann Rupert’s third time as CEO has coincided with a boom period for luxury. Still. “For me, Johann Rupert has done a very good job,” commented Jon Cox at Kepler Capital Markets. “He may no longer be so active on a day-to-day basis running the company, but he is leaving it in very capable hands with Bernard Fornas and Richard Lepeu”. Particularly as his successors acknowledge that Johann Rupert remains the boss, and a guide who no doubt intends leading Richemont to even greater success. Under his stewardship, from January 2010 to mid-November 2012, Richemont’s share price gained 85%. Over the same period, the Swiss Market Index increased 2.6%!