Richemont in talks to divest control of YNAP

Luxury goods giant Richemont on Friday said it was in “advanced talks” with UK online retailer Farfetch over its lossmaking Yoox Net-A-Porter business.

The Cartier owner said the discussions could lead to the “advanced” talks could see Yoox becoming a “neutral platform" with no controlling shareholder.

However, it warned there were still issues around over the price and terms. Activist hedge fund Third Point has taken a stake in Richemont and has been agitating for changes.

Yoox Net-a-Porter sells clothing and accessories through two online shops, but has failed to reap the benefits of the surge in online shopping during the Covid pandemic.

Richemont reported better-than-expected interim results as demand for its high-end watches and jewellery rebounded.

Group sales rose 65% on a constant currency basis to €8.9bn, beating consensus forecasts of €8.5bn against weak comparisons last year when the pandemic had hobbled the global economy. Net profit was €1.25bn in the six months to September 30, beating forecasts for €1.15bn.

"For the second half of the year, volatility is likely to persist, including in terms of inflation and geopolitical tensions," said the company, also known for its IWC watches.

Richemont's online-distributors division widened operating losses year on year to €141m despite sales rising 37% to €1.28bn due to increased communications investments and Brexit-related customs and tax costs.