Herm E S Sales Growth In The Second Quarter, Chinese Customers Meritorious Service Again

In July 23rd, Herm s, a famous luxury goods and leather goods manufacturer in France, released its two quarterly report in fiscal 2019. Data showed that the strong momentum of the first quarter continued. Sales of the brand during the period from April to June increased by 14.7% to 1 billion 670 million euros, excluding 12.3% of the exchange rate fluctuations, exceeding analysts' expectations.

In the first half of the year, the group's combined income reached 3 billion 284 million euros, an increase of 12% according to the fixed exchange rate, an increase of 15% according to the current exchange rate.

Axel Dumas, executive chairman of the company, said: "in the first half of 2019, Herm s has been very active in sales in all regions and businesses." It is pointed out that this proves its feasibility with creative driving force, outstanding professional knowledge and emphasis on technology.

In the second quarter, this wave of revenue growth was mainly due to the good momentum of growth in mainland China. Under the guidance of Chinese consumers, sales in Asia, excluding Japan, grew by 18.6%, and the growth rate of all other countries in the region reached two. The newly opened Shanghai international financial center, Singapore Jinsha gate and Floresta stores in Thailand Phuket Island have contributed to this wave of growth. At the end of this year, the brand will continue to launch a new digital platform in Singapore.

The mature market in Japan and the United States increased by 9.9% and 9.8% respectively, with the European market rising 8.3% compared with France, while the French mainland grew by 6.2%.

Cartography: BoF Fashion Business Review

Basically, every category of Herm s brand has been growing, leather goods and harness business has been pushed up by market demand by 12.2%, and the annual growth target of the Department remains unchanged. Herm s will expand its capacity and open new factories and training centers in France.

The clothing and accessories Department of men and women has become one of the most powerful sectors, with a magnitude of 16.9%. Silk and textile business grew by 5.8%, and the group will also expand its capacity and increase two screen printing production lines. The perfume business grew by 3.5%, the watch business line increased by 7.6%, and other businesses including jewellery, tableware and home business increased by 20.8%.

Other brands of the group include John Lobb, Saint-Louis, Puiforcat and Shang Xia, and other businesses recorded a 1.5% decline.

At the macro level, Herm s said: currency fluctuations at the end of June were beneficial to them and had a positive impact on revenue by 90 million euros. In the first half of the year, the brand also redeemed 56030 shares at 34 million euros, excluding transactions completed within the framework of the liquidity contract. At present, the brand operating margin should be slightly lower than the record level in the first half of 2018, an increase of 34.5%.

Despite the increasing uncertainties in the global economy, geopolitical and monetary environment, Herm s is optimistic about growth.

After the opening of the Paris stock exchange, Herm s shares rose 0.96% to 651 euros, the highest in 54 weeks. In the middle of the morning trading session, Herm s shares fell to 639.80 euros. After the closing day, it fell 0.19% to 643 euros. Herm s now has a market value of 68 billion 90 million euros, more than 66 billion 250 million euros of the larger open cloud group (Kering), and Kai Yun group will announce its first half of this fiscal year on Thursday.