Hermes rides luxury boom to record profits

Hermes posted record annual profits and sales on Friday, riding a luxury boom while faring better than its rivals in China in the last quarter of 2022.

France's high fashion houses have posted bumper earnings despite high inflation that has caused a cost-of-living crunch in many countries.

Hermes said net profit reached 3.4 billion euros (3.6 billion dollars) last year, a 38 percent jump from 2021.

Sales rose 29 percent to 11.6 billion euros at current exchange rates, slightly higher than forecast by analysts surveyed by financial data firm FactSet.

Hermes "enters 2023 with confidence, on the strength of its unique and particularly solid business model," chief executive Axel Dumas said in a conference call.

The last year was "very strong despite all the uncertainties" thanks to the attractiveness of its brand, he said.

LVMH, the world's top luxury group whose business includes handbags, jewellery and champaign, posted 14 billion euros in profits and 79 billion euros in sales last year -- both records.

It also became Europe's most valuable company last month, with a market capitalisation that soared to 400 billion euros (430 billion dollars).

French rival Kering, whose brands includes Gucci and Yves Saint Laurent, reported earlier this week a 14-percent jump in net profit to 3.6 billion euros last year.

But LVMH and Kering said their sales fell in China in the fourth quarter as the world's second biggest economy only lifted its Covid restrictions in December.

By contrast, Hermes said its sales rose by 30.7 percent in the Asia-Pacific region, excluding Japan, in the last three months of the year.

Dumas said there was "strong" demand for Hermes in China during that period.

Sales in the Americas region surged by 46 percent to exceed two billion euros. They were up 21.5 percent in Europe to 2.6 billion euros.

"I have a hard time finding you a region that's not doing well," Dumas told reporters.

Hermes announced a 13-euro per share dividend for shareholders and a special bonus of 4,000 euros to all staff worldwide at the end of the month.(AFP)