Luxury brand Chanel is paying record dividends to its owners after the super-rich flock to its stores
Chanel has paid record dividends to its owners after the super-rich moved into its stores.
The $5 billion (£4 billion) windfall was transferred from London-based Chanel Luxury Group to a Cayman Islands company controlled by 71-year-old Gerard Wertheimer and his 73-year-old brother Allen.
Wertheimers’ net worth has increased by more than a third this year to $90 billion, according to the Bloomberg Billionaires Index.
Overjoyed: Wertheimer’s net worth of Chanel owners will increase by more than a third this year to $90 billion
The payment is welcomed by brothers who did not receive dividends at the height of the pandemic last year. This is the label’s largest annual payout to date.
Chanel is known for its short black dresses and No. 5 perfumes. New products this season include the wool tweed and ruthenium-finished metal handbag in deep pink, black and silver, which retails for £6,590.
The company’s burgundy-black printed silk-muslin dress costs £7,770. Demand for some products is so high that Chanel plans to limit purchases to certain items, including its quilted classic flap handbag.
According to a recent report, the company plans to create more dedicated boutiques for affluent customers as its rapid growth risks its stores becoming “crowded.”
“Concrete customer spend” is praised with a 55 percent increase in sales over the past year to $15.7 billion. Profit rose 171 percent to $5.5 billion.
Despite paying a dividend to the tax haven Cayman Islands, the amount of tax the company has paid on its profits has more than doubled to $1.4 billion.
Wertheimer’s grandfather, Pierre Wertheimer, founded the company in 1910 with Gabrielle “Coco” Chanel.
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