Hermes Said That China'S Sales Did Not Slow Down, And The Growth Rate Was Flat In The Fourth Quarter

The preliminary sales data of Herm è s International SCA (HRMS. PA), the company that announced the latest results, continue to show that the Chinese luxury market has not slowed down.

In the fourth quarter, Hermes Asia Pacific market recorded a fixed exchange rate sales growth rate of 11.6%, excluding the growth rate of 8.1% in Japan, which was 13.1%. At the beginning of this year, the brand set up three new Chinese stores in Hong Kong, Changsha and Xi'an, and renovated and expanded the IFC store in Shanghai.

The growth rate of the American market slowed significantly at the end of the year, and the 7.9% growth rate of the fixed exchange rate was almost half of the 14.0% growth rate in the third quarter. This shows that the return of Chinese consumers pushed up consumption in the local market. At the same time, other tourism markets recorded a certain slowdown. In addition, the alarm of the global economic slowdown also weakened the confidence of American local consumption to some extent.

From October to December, the sales of French luxury goods group recorded a growth rate of 10.1%, from 1499.1 million euros to 1650.2 million euros, with a fixed exchange rate growth rate of 9.6%, which was the same as that of the previous quarter, but slowed down significantly compared with 11.2% in the first half of the year.

In its performance outlook, Hermes Group said that despite the increasing uncertainty of economy, geopolitics and exchange rate around the world, the company still believes that it can achieve fixed exchange rate revenue growth in 2019.

The solid performance growth stimulated Hermes Group shares to close 1.4% higher at 527.20 euros in early trading.

Axel Dumas, Chairman and CEO of the Group, said in the statement that he was satisfied with the performance of the past year, and the Group achieved nearly 6 billion euros in revenue, showing the continued attractiveness of brands and products.

The 9.8% fixed exchange rate growth of the leather goods department was still the stabilizer, and the fixed exchange rate growth of the clothing and accessories category in the fourth quarter was 11.7%.

The French Group said that two factories, Guyenne and Montereau, are expected to be put into operation in 2020, and another new Louviers project is expected to be completed in 2021.

The company also expects the annual operating profit margin to be about 34%, a record breaking 34.6% in 2017.

Herm è s International SCA (HRMS. PA) closed at 501 euros on Wednesday, with the intraday fluctuation basically within 1%, and ended the day down 0.36%. Since hitting a record high of 614.6 euros in June this year, the stock has fallen 18.5%.