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Hermes bags 'solid' growth in first half

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Luxury goods maker Hermes said Friday that it notched up "solid" growth in the first six months of the year and in the second quarter, driven by rising sales across all regions.

[PARIS] Luxury goods maker Hermes said Friday that it notched up "solid" growth in the first six months of the year and in the second quarter, driven by rising sales across all regions.

Hermes said in a statement that sales grew by 8.9 per cent to 1.36 billion euros (S$2.156 billion) in the three months to June, pushing first-half sales up by 11.2 per cent to 2.71 billion euros.

"We're very happy with these results. They show the stability of our growth and the strength of our business model," Hermes' chief Axel Dumas told a telephone news conference.

"The operating profitability at the end of June should be close to the highest historical level achieved last year," Hermes said in a statement.

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But it cautioned that the first-half performance "cannot be extrapolated over the full year, due in particular to the favourable impact of foreign exchange hedges in the first months of the year."

The group did not provide any specific sales targets for the current year, but said that "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."

Sales in Asia, excluding Japan, grew by 14 per cent at constant exchange rates in the period from January to June.

Sales in Japan were up three per cent, sales in America grew by nine per cent and European sales were up by seven per cent.

By division, the leathergoods and saddlery division notched up the strongest growth of 12 per cent. Sales of ready-to-wear and fashion accessories expanded by 10 per cent. The silk and textiles division grew by six percent and perfumes by eight percent.

Sales of watches, on the other hand, declined by one per cent in the six-month period, "penalised by a still challenging market," Hermes said.

AFP

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