Hermès recorded sales reaching 6.8 billion euros (7.2 billion francs) in 2019 thanks to the success of its leather goods and still strong growth in Asia, where the luxury group estimates that it is “still too much early ”to assess the impact of the coronavirus on its activity.
Sales of saddlery and leather goods increased last year by 15.4% in published data, and by 12% in organic growth, a performance in line with the consensus established by the Factset and Bloomberg agencies.
“Solid dynamics”
Its net profit amounted to 1.5 billion euros, up 9%, while its operating margin reached 34%, compared to 34.8% in 2018 “due to the unfavorable impact of hedges change, “according to a statement released Wednesday.
Axel Dumas, the boss of Hermès, praised “a solid dynamic” and “particularly remarkable performances this year, thanks to balanced growth in all business lines and all geographic areas”.
However, he estimated that it was “still too early to draw conclusions” concerning the impact of the coronavirus epidemic on the activity of the group, which makes more than half of its sales in the Asia Pacific zone.
“It fell in an important country, at an important time (ie the Chinese New Year, which generates high expenses, Editor’s note). We have 43 stores in the region if we take China, Hong Kong, Macao and Taiwan: at one point we had to close 11, today 4 are still closed. We are seeing a potential renormalization, but it is still too early to know when the rebound effect will arrive, ”summarized Mr. Dumas.
Values heckled on the stock market
Last year, the Asia zone (excluding Japan) saw sales increase by 18%, while Japan posted an increase of 8%.
In recent days on the Paris Stock Exchange, luxury stocks have been particularly rowdy, Hermès having notably lost 3.48% on Monday.
“In the medium term, despite the economic, geopolitical and monetary uncertainties in the world”, the group says “confirming an objective of sales growth at constant ambitious rates”. (Ps / nxp)
Created: 02/26.2020, 09h05
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