Hermes International bags record results

PARIS: French luxury goods maker Hermes International SA said yesterday that it notched up record sales in 2019, driven primarily on the back of strong demand in Asia, but it was too early to assess the economic impact of the coronavirus on its business.

Hermes said revenues jumped 15.4% to €6.9 billion ($7.4 billion) last year and net profit increased 8.7% to €1.53 billion.

“Hermes achieved outstanding performances ... based on a balanced growth in all the business lines and in all the geographical areas,” said chief executive officer Axel Dumas.

However, it was “still too early to draw any conclusions” about the impact of the coronavirus, he said.

The Asia-Pacific region accounts for more than half of Hermes’ annual sales.

“This has happened in an important country and at an important time of the year, namely the Chinese New Year,’’ Dumas said.

“We have 43 stores in the region, if you include China, Hong Kong, Macau and Taiwan. At one point, we had to close 11 of them. At present, four are still closed,” he continued.

“We’re seeing a potential normalisation but it’s too early to know when business will start to rebound.”

No Hermes employee had so far been taken ill, and the group had not so far experienced any supply problems.

“Around 80% of our production is in France,” Dumas said.

Looking ahead, Hermes said that “in the medium term, despite economic, geopolitical and monetary uncertainties around the world, the group confirms an ambitious goal for revenue growth at constant exchange rates.”