Luxury goods group Richemont beat expectations on Friday after high demand from Chinese consumers for jewellery and watches boosted sales over the three months to March 31, sending shares to record highs.

Sales at the owner of brands such as Cartier and Van Cleef & Arpels grew 22% at constant rates, lifted by strong growth in the Asia Pacific and Europe, as well as brisk growth in the United States.

“China is doing much better,” Chairman Johann Rupert said in a call with journalists.

Shares rose more than 5% in early trade and hit a record of 158.50 Swiss francs ($178.31).

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The sector’s biggest luxury players, LVMH and Birkin bag maker Hermes have benefited strongly from a rebound in China following three years of disruptions and closures due to COVID-19 lockdowns, as reflected in first-quarter global sales growth of 17% and 23%, respectively.

They were among the best-performing stocks on Europe’s blue-chip index .

Richemont’s sales outpaced the highest estimates on the market, said Jean Philippe Bertschy, analyst with Vontobel, noting it pointed to a further polarisation between the performance of the strongest labels as prices rise.

“The polarisation between strong brands with iconic pieces and weaker ones continued unabated, and accelerated in recent months due to high inflation,” said Bertschy.

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Richemont, which also owns watch labels IWC and Vacheron Constantin, reported a 34% rise in operating profit for the fiscal year ending in March to 5.03 billion euros ($5.54 billion) with a margin of 25.2%, above analyst expectations.

Board reshuffle

As part of an ongoing succession plan for long-serving members, the company named an American jewelry executive, Fiona Druckenmiller, to its board of directors while four other members will step down.

“We would expect the market to take these as an additional confirmation that Richemont will indeed stay independent and away from transformational M&A,” said Luca Solca, analyst with Bernstein.

Rupert said the company had not received a direct approach by LVMH, Europe’s most-valuable listed company, for its Cartier business, playing down speculation about a possible takeover or a tie-up with Kering.

Hermes beats forecasts on robust growth in China, U.S.

“We’re in constant dialogue and we respect each others’ independence,” said Rupert, referring to LVMH CEO and Chairman Bernard Arnault.