Hermès leans on strong first quarter | RetailDetail

Hermès leans on strong first quarter

Hermès leans on strong first quarter

French luxury goods manufacturer Hermès has had an excellent first half of 2014 with 1.097 billion euro in sales, 8 % higher than in the same period last year. Excluding exchange rate fluctuations, it would have even reached 12 %.

Growth mostly in first quarter

Its sales growth was mostly achieved in its first quarter with + 14.7 % (in local currency), which may have been a misrepresentation as an impending Japanese VAT increase forced local consumers to order prematurely. That helped push local sales up 21.7 % in the first quarter.

 

Nevertheless, the company grew in many areas, as all regions helped increase sales. In Asia, excluding Japan, sales grew 17 % while Japan managed an 11 % increase in the first half of 2014. The strong sales increase in the first quarter was followed by a 6.3 % sales drop. The Americas helped with a 13 % increase and Europe grew 7 % despite a persisting crisis in several countries.

 

Watches only one not up

Looking at each product category, prêt-à-porter and accessories performed well with a 16 % increase. Leatherwear went up 13 %, perfumes 8 % despite a weak performance in the first quarter. A new women's fragrance product range, called Jour d'Hermès, helped bring things back around.

 

Watches failed to follow the company's general growth as it dropped nearly 7 %, mainly because of difficult Chinese sales. The future looks even bleaker: the first quarter showed level sales, while in the second quarter sales dropped 15 %. Following anti-corruption campaigns, Chinese people wearing expensive watches are now frowned upon.

 

Hermès has not yet released financial results, which will be divulged 29 August. The company did say that the operational margins will be slightly lower than in 2013's first half (33.1 %). They should be in line with 2013's full-year margins (32.4 %).

Questions or comments? Please feel free to contact the editors


Walmart and Microsoft team up to beat Amazon

18/07/2018

Two major American companies join forces to try to beat the omnipresent threat of Amazon: Walmart (Amazon's biggest competitor in retail) and Microsoft (Amazon's main rival in cloud services) have signed a strategic partnership for the next five years.

Sales of PCs grows for the first time in six years

13/07/2018

For the first time in six years computer sales showed growth again: in the second quarter of 2018 they increased by 1.4%. According to research firms Gartner and IDC, the sales increase is mainly due to growth in business markets.

Retailhub Inspiration Tour: the customer journey becomes very different

09/07/2018

Thanks to Retailhub by RetailDetail, Antwerp has one more unique retail hot spot. Professionals can experience the future of retail in the Benelux' only retail inspiration platform, with 1250 sqm of innovative technology and huge trends.

Breakthrough in Karstadt-Kaufhof merger

05/07/2018

Canadian Hudson’s Bay and Austrian Sigma Holding have not reached a preliminary agreement about the merger of their respective department store chains Kaufhof and Karstadt: the Canadian company says it has only signed a letter of intent.

Alibaba CEO and Belgian PM discuss investment in Liège

04/07/2018

Alibaba founder Jack Ma has discussed a possible investment in Liège, Belgium with the country's prime minister Charles Michel. Afterwards no decisive statements were made by either party.

Toys "R" Us closes American stores amidst reboot hopes

02/07/2018

Final curtains for Toys "R" Us in the United States: all the stores have closed and 30,000 employees are laid off. Against all odds, some however still hope for a second life for the troubled chain.