Hermes bags profit boost as demand from Asia drives surge in sales
Luxury bag maker Hermes has posted double-digit profit growth for the full year as rising demand in Asia helped boost sales across all business lines.
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The figures
Hermes’ net profit rose 15 per cent to €1.4bn (£1.2bn).
Consolidated revenue was up 7.5 per cent to €6bn.
Recurring operating income increased six per cent to €2bn.
Net cash rose to €3.5bn.
Why it’s interesting
High-end retailer Hermes shows no signs of the troubles facing the high street, posting a strong full-year performance driven by rising sales.
Hermes said the revenue rise was a result of growth in all geographical areas. But the impetus came largely from a surge in demand from Asian customers.
Asia excluding Japan saw sales growth of 14 per cent, helped by new store openings and expansion in China, Singapore and Hong Kong.
The firm also posted double-digit sales growth in the US after opening its 34th store in Silicon Valley hub Palo Alto.
The French firm saw its weakest growth in its home country as it was impacted by the yellow vest protests.
Hermes, which is famous for its luxury handbags, saw sales rise across all business lines.
The company retained its high margins, with operating income of €2bn amounting to 34 per cent of sales. Hermes said it is maintaining its “ambitious” goal for revenue growth in 2019.
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What Hermes said
Chief executive Axel Dumas said: “This year again, Hermes achieves a remarkable performance, thanks to the talent and incredible commitment displayed by the women and men of Hermes, and confirms the strength of the group's growth model.”