PARIS: Hermes has announced strong results for the second quarter, with an increased taste for luxury among consumers boosting the firm's global sales.
Revenues for the French fashion house, famous for its leather handbags and silk scarves, rose by 21% to €1.3bn. Profits were boosted by the sale of a stake in Jean-Paul Gaultier's fashion label.
Bain & Co expect worldwide sales of luxury goods to rise by 8% this year as emerging markets continue to seek out high-end accessories and demand strengthens in the US and Europe.
Hermes plan to further capitalise on this with a programme of new store openings. Having already launched six new stores worldwide this year, a further ten will open to the public during the remaining months of 2011.
Pierre Lamelin, an analyst from CA Cheuvreux Paris, was quoted by Bloomberg as saying: "Hermes is well positioned in a buoyant luxury-goods market, delivering fast sales and earnings growth while maintaining its status as one of the most exclusive brands around."
The success of the spring-summer fashion accessories and ready-to-wear collections resulted in the highest sales growth for the quarter, up 31%.
Silks and textiles sales were also buoyant showing an increase of 29%, as were watches and jewellery both up 30% and tableware registering 25% growth.
The US and China led the sales drive with the Americas growing by 34% and Asia (excluding Japan) by 30%. Europe saw sales increase by 20%.
But Hermes CEO Patrick Thomas raised concerns that the firm's revenues could be hit by uncertain global economic conditions over the coming months.
In a telephone interview with Bloomberg, Thomas warned that "our business is highly psychological and when people feel there is a bad mood internationally, there is instability, there is a threat on the economy, then people buy less".
Data sourced from Hermes/Bloomberg; additional content by Warc staff