Silversmith Christofle bets on jewelry for growth

PARIS Wed Jun 4, 2014 12:24pm EDT

PARIS (Reuters) - French silverware specialist Christofle is betting on jewelry to drive growth to reduce its reliance on high-end tableware, a market in perpetual decline due to changing consumer habits, its chief executive said on Wednesday.

Christofle, a rival of Hermes's Puiforcat and Crystal Saint-Louis as well as Paris-listed Baccarat and Guy Degrenne, said its silver jewelry, costing on average 350 euros, was its fastest growing product category.

Christofle Chief Executive Thierry Oriez said the company was breaking even and generating 80 million euros ($109 million) in annual sales. He aims to see jewelry making up a quarter of revenue, up from less than 10 percent today.

"Jewelry is a very important growth driver for us," Oriez told Reuters in an interview at the company's headquarters on the prestigious rue Royale in Paris, above a flagship whose forefront is dominated by silver pendants and bracelets.

Christofle, a maker of silver cutlery, trays and goblets which branched out into jewelry in 2005, currently puts out four jewelry collections a year. Its best-selling collection was designed by Andrée Putman, the French interior and product designer who died earlier this year.

Oriez said the decline of the tableware market started in the 1980s as consumers increasingly preferred practical tableware to fragile, high maintenance items, opting to spend their wedding list money on trips rather than fancy cutlery.

As a case in point, Hermes's Crystal Saint-Louis, the oldest glassmaker in Europe dating back to the 16th Century, which has a store right next to Christofle, says none of its items are compatible with dishwashers.

Rival Baccarat, which is also pushing its jewelry line to boost sales, last year incurred a net loss of 9.7 million on sales of 149.3 million euros, down nearly 6 percent.

Oriez declined to reveal Christofle's sales growth but said revenue was stable in France, where it made a quarter of its sales, and was growing in the United States and Asia where the company was expanding.

Christofle, founded in 1830 by Charles Christofle and once a regular supplier of Europe's monarchies, makes the bulk of its sales from cutlery and big corporate clients such as luxury hotels and gourmet restaurants.

It is also betting on its new silverware technology which delays the oxidation of products to the sales of decorative items such as silver trays and plates.

Christofle is controlled by three shareholders, the Swiss bank Lombard Odier, the Rolaco fund and Chalhoub group, a distributor of luxury products, including Louis Vuitton, in the Middle East.

Oriez declined to give details on the precise shareholder structure of the company but said the Christofle family, progressively diluted over the years, still owned a small stake.

Asked about the possibility of a tie-up with Baccarat, which with Christofle shares franchises in countries such Lebanon and Morocco, Oriez said relations were amicable but there were "no such talks."

(Editing by Andrew Callus/Mark Heinrich)