Richemont Pumps Up Fragrance Business
● The company has hired a Dsm-Firmenich alumnus to head a new platform aimed at scaling the fragrance businesses in its portfolio.
LONDON — Compagnie Financière Richemont is raising the bar on its beauty business with the formation of Laboratoire de Haute Parfumerie et Beauté, a platform aimed at scaling the fragrance brands in its portfolio.
Boet Brinkgreve has been named chief executive officer of the division and reports to company chairman Johann Rupert.
Brinkgreve will help the six maisons already involved in fragrance “to reach critical mass in this highly competitive field, where scale is crucial,” Richemont said. The company added the new platform “will leverage resources across our maisons to help develop the most refined creations and promising licenses.”
Richemont brands with fragrances include Cartier, Van Cleef & Arpels, Chloé, Dunhill, Alaïa and Montblanc. The brands' licensing partners including Interparfums and Coty, while Cartier is developed by an in-house perfumer.
“Boet's role will be instrumental in enabling our maisons to reach their full potential in this dynamic market, broadening their clientele base whilst enhancing the maisons' capabilities to meet the needs of their highly discerning clientele,” Rupert said Wednesday ahead of the company's annual general meeting in Geneva.
“With his deep knowledge of the fragrance industry, prior success in driving new ventures, remarkable track record in building winning international teams and commitment to sourcing sustainable ingredients, I am convinced that Boet will prove to be a notable addition to the group.”
Brinkgreve will also join Richemont's senior executive committee.
Shares in Interparfums, which holds licenses for the Montblanc and Van Cleef & Arpels fragrances, closed down 9.4 percent at 54.10 euros on Wednesday.
Montblanc is Interparfums' largest brand. In the first half of 2023, Montblanc generated 107.4 million euros of the group's total sales of 396.1 million euros. Van Cleef is the group's seventh-largest brand, which rang up 12.4 million euros in the six-month period.
Richemont did not offer any further details about the new division, although a source familiar with the company said that size matters in the fragrance business and that Richemont wanted a fresh pair of eyes across the portfolio in order to make the most of its existing fragrance businesses.
The source said the formation of Laboratoire de Haute Parfumerie et Beauté was not an attempt to take Richemont's fragrances in house, but rather to offer “strategic guidance” to the brands about how to build their businesses and become more sustainable.
Brinkgreve joins Richemont from Dsm-Firmenich, where he held a number of senior executive positions from 2007 until 2023. His latest role was president of Ingredients & Group Procurement and a member of the executive committee.
He has also worked for DuPont in business development roles and is an entrepreneur who has founded several start-ups. A Dutch-born Swiss national, he holds a master's degree in business administration from Insead.
Ahead of the AGM, Rupert also commented on macroeconomic matters, inflation and the company's future.
He said that a decade of low interest rates and central banks' “excesses” in printing money has been damaging to countries and consumers, and that higher interest rates were taking their toll.
“As I told you in May, demand in the United States started softening in November, albeit from a high base, sales having doubled over three years over there. We also said China will take longer to fully recover…and it has been proven to be correct. In Europe, ongoing inflation is starting to impact local demand, but the good news is that we are starting to see the Chinese traveling again, including Europe,” Rupert said.
His comments sent Richemont's share price tumbling. The shares closed down 5.2 percent at 117 Swiss francs on Wednesday.
Separately, Richemont said Gary Saage, the group's former chief financial officer, will be proposed for election to the board at the company's annual general meeting in 2024.
If elected, he'll be named chairman of Richemont's audit committee. If elected, he will take over from Josua Malherbe, the Audit Committee chair.
The straight-talking Saage is a Richemont veteran and has served on the board in the past. On the quarterly press calls and analyst presentations, he was engaging, thorough in his responses, and rarely swerved a difficult question.
Richemont said he brings with him “invaluable knowledge” of the company, relevant financial skills and the “financial discipline” to perform this important role.
A graduate of Fairleigh Dickinson University in New Jersey, and a certified public accountant, Saage joined Cartier in 1988. In subsequent years, he served as chief operating officer of Richemont in North America and Dunhill in London.
In 2006, he moved to Geneva to act as group deputy finance director, and in 2010 was promoted to CFO. He served on the board of directors from 2006 until 2021 when he stepped down from his CFO role.
He returned full time to the U.S. and served as chairman of Richemont North America and related companies until August 2023 in a non-executive capacity, overseeing governance matters.
Rupert welcomed Saage back to the board, and said he would be an asset as head of the audit committee.
“This is a complex role that requires proficiency of accounting and regulatory matters, business acumen as well as the courage to speak up in challenging situations, all competencies that he has clearly demonstrated during his long career. It also requires deep institutional knowledge which Gary, having joined Cartier the year I founded Richemont and worked across different parts of the group, indisputably has,” Rupert said.
On Wednesday, Richemont also proposed other appointments to its senior executive committee for 2024. Swen Grundmann will join the committee in his new capacity as director of corporate affairs in addition to maintaining his role as group company secretary. He will continue to report to Rupert.
A Dutch national, Grundmann holds a law degree from the Faculty of Law from the University of Amsterdam.He started his career at Richemont in 1996 as legal counsel and was appointed group company secretary in 2017 and was involved in various merger and acquisition projects.