(News Bulletin 247) – The company generated revenues of 3.7 billion euros in the third quarter, up 10.1% on a published basis and more than 11% on a comparable basis.

Do the laws of gravity apply to Hermes? The saddler-leather goods maker once again published double-digit growth this Thursday for the third quarter, which contrasts with the drop in LVMH’s revenues over the same period (-3% like-for-like) and the plunge in those of Kering ( -16%).

Over the period from July to the end of December, Hermès generated revenues of 3.7 billion euros, up 10.1% in published data and 11.3% excluding exchange rates. Deutsche Bank expected revenue growth to be limited to 9% based on published data and 10% excluding currencies, while Stifel anticipated growth of 10.8% excluding currency effects.

“In an uncertain economic and geopolitical context, I congratulate all employees for the robust performance of the third quarter, and I thank our customers for their loyalty. Building on the uniqueness of its model, Hermès is continuing its recruitment and long-term investments. term”, declared Axel Dumas, the manager of Hermès in a press release.

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Japan’s great resistance

Certainly, Hermès is marking a slowdown in its growth, after seeing its revenues increase by more than 13% excluding exchange rates in the second quarter and more than 15% in the first. But the performance remains impressive given the deterioration of the economy in China, an important market for the sector (around 30% of luxury groups’ revenues according to Bank of America), as reported by Hermès’ rivals.

The company’s activity is not completely immune to the sluggishness of the Chinese market. Hermès’ revenues increased by only 1% excluding currencies in Asia-Pacific, a region which includes China. This marks a further slowdown after growth of 5.5% in the second quarter (and 13.9% in the first).

Unlike other luxury groups, Hermès continued to record vigorous growth in Japan, of 22.8% excluding exchange rates, which even rose after the 19.5% in the second quarter.

LVMH and Kering both reported a fall in their growth in Japan in the third quarter. Activity in this country has been driven, in recent quarters, by spending by Chinese tourists in the country, attracted by the weakness of the yen and therefore the more affordable prices of luxury products in Japan. But this impact did not a priori weigh on Hermès’ activity in the country.

Management cited “local customer loyalty” to explain these figures. The financial director, Eric du Halgouët, reminded him that Hermès’ revenues in Japan were mainly made with this local clientele (around 90%).

No trend breaks in September

Furthermore, Europe and the “Americas” zone continued to post remarkable performances, with respective growth of 17.4% and 13.4% excluding exchange rates. By category, the company’s two main divisions, namely “leather goods and saddlery”, and “clothing and accessories” grew by 14% and 13.5% respectively on a comparable basis.

The financial director, Eric du Halgouët, told analysts that across all “mature” markets (France, Europe, Japan, United States) there had been no “trend break” in October compared to in the third trimester.

The manager also indicated that there had been no break in “Greater China” (which includes Hong Kong and Macau) with turnover approximately equal in the third quarter to the second.

The financial director explained that China was currently experiencing “a traffic problem” which was however offset by “a value strategy” with an increase in the basket in leather, jewelry and ready-to-wear.

On the Paris Stock Exchange, the copy of Hermès is appreciated by the market, the title taking 2.3% around 10:15 a.m., one of the strongest increases in the CAC 40. “Hermes remains the favorite of investors due to the desirability of its brand, its wealthier clientele and its waiting lists, which reinforces the opinion that Hermes is a major player in the global economy”, judges Deutsche Bank for its part.