Luxury leather goods brand Hermes posted stronger than expected fourth quarter results on Wednesday, after international growth and currency fluctuations had a positive effect on figures.
Consolidated revenue passed the 5 billion euros threshold, amounting to €5,202,00 million, up 7.5 percent at current exchange rates and 7.4 percent at constant exchange rates. Sales growth was also strong in the fourth quarter, up 8 percent at current exchange rates.
The brand saw strong growth in all geographical areas, including a 9 percent increase in revenue in Japan, 7 percent increase in the rest of Asia and 8 percent growth across Europe.
The company posted “remarkable” growth in its leather goods division, attributing the success “the collections and the diversity of models, particularly the Constance, Halzan and Lindy bags alongside the Birkin and Kelly.” Development was also supported by the sustained pace of deliveries and production, gaining from the capacities of the three new sites in Charente, Isère and Franche-Comté.
Hermes also benefitted strongly from positive currency fluctuations, contributing a further 3 million euros to overall revenue.
Looking to the future, the company confirmed that operating profitability should be slightly higher than originally anticipated full the full year 2016. In a statement, it said:
“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.”