Asia and US sales boost Hermès

Warc, 14 February 2013

PARIS: Hermès reported a strong performance for 2012, signalling continued strong demand for luxury goods and services in Asia and the US.

The company saw resurgent demand in the Americas, where sales increased 21% to €184.6m during the quarter and 14% to €567m over the year, the Wall Street Journal reports.

This signals that consumers in the world's largest economy retain a hunger for high-end goods and services, despite the ongoing economic volatility.

"We didn't open any new stores or do any renovations in 2012 in the US, so [growth] was really done through the existing store network," said Axel Dumas, Hermès's chief operating officer.

"Trends in luxury consumption in the US have continued to outperform overall consumer trends," Antoine Belge, HSBC luxury-goods analyst, told the Wall Street Journal.

The strongest growth for the period came in Asia, excluding Japan, where sales leapt 29.7%, helped by the opening of two new stores in Taiwan and China, and the renovation or expansion of six others.

For the full year, sales in the region, excluding Japan, rose 25.4% to €1.1bn. Japan itself recorded more modest increases, with fourth quarter sales growing 15.1% and full year sales up 6.8%.

Quarterly sales growth in Europe was slower at 11.6%, but the company described as "impressive" the 14.5% achieved over the full year, with a positive contribution from nearly all countries.

Across all regions, sales were up 16%, at constant exchange rates, to €3.48bn. In particular, sales grew faster than expected during the fourth quarter, when revenue was up 18.5% on a year earlier.

In terms of specific product sectors, the ready-to-wear and accessories division showed the strongest growth at 22%, followed by watches on 16%, silk and textiles on 16%, perfumes on 14% and leather goods on 12%.

The 'other Hermès sectors' recorded an exceptional growth figure of 45% thanks to the success of the company's jewellery collections.

Data sourced from Hermès/Wall Street Journal; additional content by Warc staff