Hermès Boasts Strong Q3, Maintains Growth Forecast

In What's New, Industry News by Jeff Prine

hermesjewelryParis—On the upper end, growth tends to be on target despite the slowdown in Greater Asia. On Thursday, Hermès reported its third quarter sales rose 7.9% on a like-for-like basis, helped by demand for its leathergoods and ready-to-wear.

Sales reached 1.14 billion euros (about $1.23 billion. For its first nine months of 2015, the luxury maison reported sales increases of 19% (in current exchange rate and 9% at constant exchange rates).

At the end of September, the group’s consolidated revenues reached €3 443 million, up by 19%. At constant exchange rates, growth is 9%.

Target Upheld

Hermès maintained its 2015 target of 8% sales growth at constant exchange rates and an operating margin below the 31.5% achieved last year.

Sales by region were: Japan (+19%), Asia excluding Japan (+5%), which gained from the opening of the Maison Hermès in Shanghai in September 2014, improved in spite of a difficult context in Hong Kong, Macao and to a lesser extent in continental China,

America (+7%) pursued its development in an uncertain environment. Europe (+10%) posted a good performance in Group stores, particularly in France and Italy.

Sales by sector were Leathergoods and Saddlery up 12%; Ready-to-wear and Accessories (+9%) stem mainly from the success of fashion accessories and the latest ready-to-wear collections.

The Silk and Textiles division (+3%), which is enhancing its collections with new formats and materials, recorded growth despite a challenging context in Greater China.

The Perfume division (+6%) continued its growth driven by Terre d’Hermès and the latest creations.

Watches (-2%), which were slightly down, are still penalized by wholesale business on a still difficult market, particularly in Asia excluding Japan.

Other Hermès business lines (+12%) continued their development, driven particularly by the success of gold jewelry.

 

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