PARIS, France — Hermès International SCA, the French maker of Birkin bags and silk scarves, reported first- quarter sales that beat estimates, led by demand in Japan.
Revenue jumped 10 percent to 943.5 million euros ($1.31 billion), Paris-based Hermès said today in a statement. Analysts predicted 921 million euros, according to the median of nine estimates compiled by Bloomberg. Sales excluding currency swings advanced 15 percent.
Sales on a constant-currency basis surged 22 percent in Japan, exceeding estimates, as Hermès raised prices and shoppers splurged in advance of a sales tax increase, the maker of $10,000 handbags said. An 18 percent revenue gain in the rest of Asia confirmed a positive trend, particularly in China, Hermes said. In Europe, where sales rose 7.9 percent, business remains sustained in a difficult economic environment, the company said.
“Hermès will continue its long-term strategy,” the luxury-goods producer said. “Above all, it is our company’s unwavering determination to continually reinvent itself in order to push the limits of excellence.”
Hermès is adding production facilities in France and opening more stores as the highest segment of the luxury industry resists a slowdown. Italian cashmere clothier Brunello Cucinelli said this month that he’s very confident about the top end of the market because super-wealthy consumers continue to seek exclusive products.
Profitability at Hermès is likely to shrink this year from a record in 2013, weighed down by the weakness of the Japanese yen, the company said in March. First-quarter sales advanced 13 percent last year at constant currencies.
Hermès rose 1 percent to 254.65 euros at the close in Paris yesterday. The stock has declined 3.4 percent this year, valuing the saddle-maker part owned by rival LVMH Moet Hennessy Louis Vuitton SA at 26.9 billion euros.
LVMH reported its fastest fashion and leather-goods sales growth in two years when it published first-quarter revenue figures on April 10.
By Andrew Roberts; Editors: Celeste Perri, Tom Lavell.
Bloomberg
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