Strong growth in the first half-year for Hermès

Sales growth was very solid in the group’s stores (+13% at constant exchange rates).The sustained growth in the second quarter (+12% at constant exchange rates and +15% at current exchange rates) is in line with the trends seen over the first three months of the year.

In the first half of 2019, revenue increased in all geographical areas worldwide:

• Asia excluding Japan (+18%) continued its outstanding performance, with positive momentum in continental China and double-digit growth in all other countries in the area. The Group benefitted from successful store openings and extensions in recent months, particularly Shanghai IFC in China and Marina Bay Sands in Singapore. A new store opened in March in Phuket Floresta in Thailand. Rollout of the new digital platform in Asia will continue at the end of the year in Singapore.
• Japan (+10%) confirm its sound growth. The new hermes.jp platform was successfully deployed in June, offering editorial content and products which reflect the diversity of the Maison’s creations.
• America (+10%) posted strong performance at the end of June, despite a high comparison basis. Last April, the Group opened its 36^th store in the USA at the heart of New York’s Meatpacking district, and reopened the Waikiki store in Hawaii in June.
• Europe excluding France (+9%) and France (+4%) achieved a good performance. The store in Amsterdam reopened in May after extension, and the store on Stoleshnikov Lane in the historical centre of Moscow was renovated in June. In France, sales improved during the last months of the period.

The momentum in the first half was driven by solid growth across all business lines, with remarkable performance of the Ready-to-Wear and Accessories division.

Growth in Leather Goods and Saddlery (+12%) was particularly sustained over the first half of the year, based on collections blending style, know-how and diversity of materials. The division’s annual growth target remains unchanged. Demand remains very high, both for the Maison’s classics and other models, such as the Mosaïque and 24/24 bags. The increase in production capacities continued, with the ground breaking of the Maroquinerie de Guyenne workshop in June, scheduled for completion in 2020, and the announcement of a new workshop in Louviers by 2021. Hermès continues to strengthen its local integration in France with the opening of a training centre in Fitilieu (Isère), and the announced extension of the Ganterie-Maroquinerie de Saint-Junien workshop (Limousin region).

The Ready-to-Wear and Accessories division (+15%) pursued its strong growth, thanks to the success of the men’s and women’s ready-to-wear collections and of fashion accessories and shoes.

The Silk and Textiles business line (+4%) confirmed its positive momentum, benefitting from sustained demand and the diversity of materials, along with outstanding creativity and know-how. The Pierre Bénite site (Rhône) will be extended to support development and will accommodate two new printing lines.

Driven by the success of Terre d’Hermès and the new creation, Un Jardin sur la Lagune, Perfumes (+3%) posted an increase, despite a high comparison basis at the beginning of last year following the launches of Twilly d’Hermès and Eau de Citron noir.

The Watches business line (+14%) performed very well, reflecting the creativity of the collections. The Galop d’Hermès model, inspired by the harness collections, received a very warm welcome.

Other Hermès business lines (+19%) recorded a positive increase over the period, both in Jewellery and in the Home universe.

In the medium term, despite growing economic, geopolitical and monetary uncertainties around the world, the Group confirms an ambitious goal for revenue growth at constant exchange rates. Thanks to its unique business model, Hermès is pursuing its long-term development strategy based on creativity, maintaining control over know-how and singular communication.

August 22, 2019