Hermes'S First Quarter Sales Surged Year-On-Year In The 16% Quarter, The Fastest Growth In 4 Years.

Hermes, which was overtaken by Gucci, has recorded its strongest quarterly growth in 4 years.

According to the first quarter results released by France's luxury brand Hermes, its sales rose 16% to 1 billion 610 million euros in the same period, and increased by 12% at fixed exchange rates, which was more than the 10% expected by the company. It is the largest increase in the past four years, but still lagged behind the 20% growth of the LVMH fashion department and the growth rate of Gucci 24.6% in the same period.

The picture shows Hermes's main performance data for the first quarter.

By Sector:

During the period, sales of the Hermes core handbags and harness Department increased by 16.9% to 808 million euros, accounting for 50% of the total revenue.

Sales of garment accessories Department rose 17.5% to 360 million euros, accounting for 22.3% of total revenue.

Sales of silk and textile sector increased 6% to 140 million euros, accounting for 8.6% of total revenue.

The sales volume of the perfume Department increased by 3% to 84 million 600 thousand euros under the promotion of Terre d'Herm s, accounting for 5.2% of the total revenue.

Watch sales rose 22% to 43 million 400 thousand euros, accounting for 2.7% of total revenue.

Sales of other sectors including household and jewellery products increased by 22% to 116 million euros, accounting for 7.2% of total revenue.

The picture shows Hermes's main performance data for the first quarter.

By Region:

Hermes's sales in Japan increased 16.7% to 204 million euros in the first quarter.

Sales in Asia, excluding Japan, surged 21.5% to 860 million euros.

US regional sales increased by 17.1% to 269 million euros. Hermes opened a new boutique in New York's meat processing area earlier this month, covering an area of 5330 square feet, and set up the first cafe bar to attract more new consumers.

The brand has also performed well in Europe except France, with sales rising 9.3% to 261 million euros, mainly driven by the British market.

Sales in France were affected by the "yellow vest" protest, which increased by only 1.4% to 184 million euros.

Axel Dumas, chief executive of Hermes, said that the growth of its performance was mainly due to its continued popularity of Chinese consumers, such as its iconic platinum packages and Kelly bags. During the period, the revenue of brands in Greater China increased by more than 10%.

Some analysts pointed out that this undoubtedly further eased investors' worries about the reduction of luxury consumption in China's wealthier class.

What it means is that in the second quarter of fiscal 2018, sales of hermes handbags and harness Department slowed to 3%. Since 2017, Hermes has started to build more factories to increase production capacity so as to alleviate the shortage of supply.

Fashion headlines pointed out earlier that although Hermes also owns other businesses such as garments, harness, perfume and jewellery watches, its core revenue source is still handbags, which has a very important strategic significance for Hermes. Platinum bags are located in the center of Pyramid, representing the brand luxury attributes.

At present, Hermes has a total of 52 production plants, of which more than 40 are located in France, and its production base in Guyenne and Montereau will also be completed in 2020. The brand also recently issued a statement that it plans to establish a new leather factory in Normandy and employs 250 workers.

Hermes's measures to increase production can be seen immediately.

According to fashion headline data, the sales growth of Hermes leather and harness sector accelerated again in the third quarter and the fourth quarter of fiscal 2018, and returned to 9% last year. The sector revenue increased 9.4% to 2 billion 975 million euros last year.

The picture shows Hermes's main performance data for 2018.