HERMES sales surged at the end of last year as the Birkin bag maker weathered the slowdown in demand for luxury goods with its unique model driven by scarcity.
Fourth-quarter revenue climbed 17.5 per cent at constant exchange rates, Hermes International SCA said in a statement on Friday (Feb 9). Analysts expected a gain of about 14 per cent. The company also announced plans for an exceptional dividend of 10 euros a share.
Despite a cooling in demand for luxury products following the post-pandemic boom, Hermes’ brand still lures wealthy customers willing to splurge on its hard-to-get handbags and pricey silk scarves. All the main divisions of the Paris-based company grew by at least 10 per cent.
In a call with reporters, Hermes executive chairman Axel Dumas said the company plans product price hikes of 8 per cent-9 per cent on average in 2024.
Recurring operating income for the year rose to 5.65 billion euros (S$8.19 billion), topping analysts’ estimates.
Hermes results follow a mixed picture for the industry in the past quarter. LVMH, whose brands include Louis Vuitton and Christian Dior, and Cartier owner Richemont showed resilience. Companies undergoing turnarounds, such as Burberry Group and Gucci owner Kering, fared less well. BLOOMBERG
