Hermès celebrates 70 years in silk

Hermès is celebrating 70 years of selling silk scarves by hosting a two-week exhibition in Hong Kong , at the city's Pacific Place mall on 29 June. The exhibition, called “Once Upon a Silk”, gives an overview of the French fashion house's use of silk throughout the decades. The company commissioned US artist Hilton McConnico who designed a show that uses a Chinese legend about the origins of the Silk Route to best showcase the Hermès silk archives. According to the tale, a bird with wings of silk sets of on a journey to discover the meaning of life and shed its feathers along the way. These created the Silk Route. Using this storyline, McConnico illustrates the evolvement of and themes used in Hermès' silk scarves.

The first silk scarf the company made was in 1937 and was called “Jeu des Omnibus et des Dames Blanches”. The scarf is included in the exhibit. Since then, Hermès has introduced about 1,500 scarf designs. The exhibition moves to the Shanghai Art Museum on 8 September and will also feature designs by Chinese artists, which were commissioned by McConnico.

www.hermes.com
19 June 2007

Hermès opens in India

French luxury company Hermès is opening up for business in India. During a general shareholders meeting on Tuesday, the company revealed it had established a joint venture to open stores in that country. Hermès holds 51 percent of the joint company with a prominent Indian family, who remains nameless. The first store is expected to open in New Delhi.

Hermès also said that sales elsewhere in Asia, particularly China, were strong. Chinese sales leaped 70 percent last year and the firm plans to open another three stores there in 2009. The exception is Japan, which is proving tricky for most purveyors of luxury goods. The firm's chief executive Patrick Thomas said that the target for current trading in Japan was 8 to 9 percent comparable-sales growth, perhaps even 10 percent, “if Japan improves”, although he was not bullish on the possibility.

The US has big potential for the brand. Thomas said that the company would open approximately stores there and would spend €70 to €80 million to open and renovate US stores this year.

www.hermes.com
6 June 2007

Hermes posts quarterly profit

Hermes, arguably France 's most luxurious fashion house, on Friday posted a 3 per cent rise in earnings to 351.3m euros. Patrick Thomas, chief executive officer of Hermes International, referred to the quarterly growth as consistent with the firm's full-year target of 7 to 7.5 percent.

Thomas further noted the increase would have been close to 10 percent were it not for the elimination of a range of accessories considered a threat to Hermes' upscale image. Thomas also heralded growth in Europe, with the exception of France, where sales jumped 12.6 percent in the quarter to 63.6 million euros "Also, luxury has been going very well in the U.S.," he added. The Americas logged a 7.5 percent organic increase to 55.1 million euros. Gains were more modest in points east, with an 1.8 percent organic increase in Japan to 94 million euros and a 3.1 percent rise in Asia to 156.7 million euros.

www.hermes.fr
12 November 2006

Hermès Q2 sales slowdown

Luxury goods house Hermès International witnessed a slowdown in sales for the second quarter. The company attributed the slowdown to early spring-summer deliveries, but said it would achieve its top-line target of 7 to 7.5 percent growth for the fiscal year. Sales for the quarter ended 30 June gained 4.5 percent to €339 million, thanks to strong sales of perfumes, leather goods and jewellery. "We are totally in line with our expectations," said Mireille Maury, managing director of finance and administration. She pointed out a 9 percent increase in sales during the period of the company's own retail network and said that the outlook for July remained positive. Sales for the first half rose 7.9 percent to €700.5 million.

Nevertheless, analysts were disappointed with the results in an otherwise upbeat luxury sector. Earlier this week LVMH reported a 10.5 percent increase in second quarter sales and a 13 percent rise for the first half. "Once again, Hermès' wholesale business (30 percent of total sales) proves very volatile," WWD quoted HSBC analyst Antoine Belge as having written in a research note. "In 2006, Hermès should once again underperform the industry." He added that due to a weak yen, Japanese are spending less on silks, causing disappointing results of this product. Maury, however, noted that sales of silk products at Hermès own stores rose 7 percent in the second quarter. The sale of leather purses gained 20 percent, but ready-to-wear sales remained flat.

On a more positive note, perfume sales soared 34.1, thanks mainly to the strong sale of men's fragrance Terre d' Hermès. Due to strong demand for small leather goods and jewellery, sales of other sectors gained 24 percent to €34.6 million.

Sales in Europe , excluding France , rose 17.9 percent to €64.4 million. The company is continuing to open shops in Europe . It recently opened boutiques in Amsterdam and Copenhagen and a shop in Venice will open in October. The US is also fairing well as geographical region. "The trend is also very strong in the US ," said Maury, pointing out a rise of 11.7 percent to €51.3 million. Meanwhile, sales in the Asian Pacific region dropped 0.6 percent, despite "strong development" in China , as described by Maury. She said that the opening of a Maison Hermès in Seoul in November would bring about a turnaround in the region.

www.hermes.com
27 July 2006

Hermes has big plans for China

French luxury house Hermès has made it known that it has ambitious plans for the Chinese market. Chief executive Patrick Thomas told shareholders that it aims to double sales in mainland China over the next few years. He added that the company will "accelerate" growth in North America .

Thomas said that company growth was up about 7.5 percent, more or less unchanged from last year and in line with expectations. He indicated that investments in shops and new production facilities should help steer Hermes to an average annual growth of 10 percent. The company currently has some 30 new boutiques or renovations on the agenda for this year, including shops in Seoul , Amsterdam and Venice .

It was Thomas' first shareholders' meeting since Jean-Louis Dumas stepped down for health reasons. Jerome Guerrand-Hermes, who has a seat on the executive committee, was one of many to pay tribute to him. "(Dumas') commitment to quality was such that he made the artisans heroes," he said.

www.hermes.com
13 June 2006

Gaultier cracks the whip at Hermes

Jean Paul Gaultier showed his most inspired interpretation of the spirit of the Hermes yet. The French luxury house began life as a saddler and is renowned for its leather goods and silk scarves - and now ready-to-wear - since Gaultier took on the job of Hermes's women's designer two years ago. Blacks, browns, mulberries and flashes of metallic silks pervaded the collection. There were pantsuits and smoking jackets, transparent muslin blouses, cuffed trousers worn long over high heels, with bulging fur capes, trailing skirts and Asian-inspired black and golden dresses and jackets printed with dancing girls.

Against the intermittent sounds of horses' hooves hitting the cobblestones, Gaultier played with the image of the chic Parisienne who fences or canters, Birkin bag in hand. The inspiration for the fabled leather creation, Jane Birkin, was in the audience to see her influence on the contemporary label undergo another paradigm shift under Gaultier's direction. In an infectious display of his growing confidence as the keeper of the legacy of Hermes, the designer made an unscheduled post-show appearance on the catwalk of the Ecole des Beaux Arts to talk about the "coquette Parisian allure" of the collection.

"It was based on fencing, you know?" he said, miming the act. "But that is only like an accessorisation. It was all about clothes that are good quality and well done with excellent techniques and good fabrics. So fencing was only like a kind of little fantasy to show it in a way that is also an image of Hermes."

6 March 2006

Hermès posts strong 2005 results

Despite coming in shy of analysts' expectations, luxury fashion house Hermès International recorded strong results for fiscal 2005. Sales for the year were up 7.2 percent to €1.43 billion (£983 million). The fourth quarter saw sales rise 8 percent to €437.1 million. The company reported "excellent" consumer reaction to its new fragrance Un Jardin sur le Nil, which boosted perfume sales by 12.5 percent for the year. Meanwhile, full year sales of its women's ready-to-wear division - designed by Jean Paul Gaultier - climbed 7.6 percent.

The company's managing director of finance and administration, Mireille Maury, pointed out to WWD that growth had accelerated in the second half and that December had been a "very good" month, with sales up 17 percent in Europe. She added that an increase in margins would allow Hermès to reach double-digit gains in operating profits. This year Hermès will open and renovate 30 stores, as opposed to eight in 2005. Openings are planned in Seoul, South Korea; Amsterdam; Charlotte, North Carolina; Bankgok, and Hangzhou, China. Meanwhile, the store in Tokyo's Ginza district will be expanded in October.

Sales rose across the board in the quarter ended 31 December. Europe, excluding France, saw sales increase 16.9 percent to €79.1 million. Sales in Japan, which accounts for 29 percent of total sales, rose 7.2 percent to €128.5 million. The Asia-Pacific region enjoyed a 7.9 sales increase to €68 million, while the Americas saw only a modest rise of 1.3 percent to €69.7 million. Hermès blamed this on fewer selling days, though Maury pointed out that the "trend there remains good".

Sales of bags and luggage rose 5.4 percent to €169.2 million. The company attributed the growth to increased production capacity, but also said that demand still exceeded supply. Maury said that the Birkin, Kelly and Bolide models were still the most popular leather handbags. Goldman Sachs analyst Jacques-Franck Dossin welcomed management's decision to cut production of canvas bags, which posed a threat to the company's brand image. In a research note he wrote that these "were initially launched as beach bags, but became increasingly used as city bags, particularly in Japan."

The sale of ready-to-wear and accessories grew 7 percent to €79.7 million in the quarter. The sale of watches lost ground, however, dropping 2.1 percent to €33.2 million.

www.hermes.com
9 February 2006

Hermes reports solid Q3 results

French luxury house Hermes International has reported solid results for the third quarter and the first nine months of 2005. Revenues increased, based on strong demand for leather bags, silk ties and scarves. Between July and September, revenue rose 11 percent to €341.2 million (£229.8 million) from €306.1 million during the same period the year before. Revenue for the nine-month-period reached €990 million, up from €927 million last year. The leather bags and luggage division realized an organic growth in the nine-month-period of 8.6 percent to €399 million, despite a slow down in sales in the first half due to supply problems.

The silk division grew organically by 11 percent, while clothing and accessories revenue rose 7.8 percent. French sales climbed 5.5 percent, while American sales leapt 14 percent. Meanwhile, revenue in Japan rose 5.2 percent in the first nine months.

www.hermes.com
10 November 2005

Hermes Q2 sales are up

Luxury house Hermes has reported a rise in second quarter sales of 6 percent ot €324.3 million (£224.8 million) at current exchange. Sales in the second half ended 30 June climbed 4.6 percent to €649.1 million. At constant exchange rates the increase would have been 6.2 percent.

A research note released by investment bank Merrill Lynch, which downgraded Hermes status from 'buy' to 'neutral' stated: "The soft spot is Japan . While this performance is disappointing at a time when all other players are performing well in Japan , we stress that Hermes sales have grown by 13 per cent per annum between 2001 and 2004 in this market. As a result, the company today faces more difficult comps than sector peers, but still has a strong potential in Japan in our view."

Hermes sales rose noticably in the US , up 14.7 percent to €95.3 million. By sector, Hermes silk goods performed well, with sales up by 10 per cent.

www.hermes.com
9 August 2005

Hermes Growth On Target

French luxury group Hermes International's reported a drop in first-quarter revenues due to late deliveries, but said the pace quickened in March and April, and that it maintained its goal for full-year organic sales growth of 8 percent.

Hermes reported that sales in the three months ended March climbed 3.3 percent to 324.8 million euros, from 314.5 million euros a year ago, driven by robust sales in its main leather goods category. Though sales grew 8 percent in Hermes retail outlets, the company was weaker at wholesale, due mainly to late deliveries in small leather goods, watches and tableware.

Fashion also is performing and the sales of Jean Paul Gaultier's second ready-to-wear collection for the house has been deemed "very good." Overall sales of rtw and fashion accessories, including shoes, gloves and hats, improved 7.2 percent to 75.8 million euros.

Fragrance sales jumped 19 percent on "excellent" sales of the new Un Jardin sur le Nil perfume. Silk sales gained 3.6 percent to 36.7 million euros. Performance in the U.S., where sales gained 16.7 percent at constant currency rates to 49.6 million euros. After exchange conversions, sales in the U.S. were up 12 percent.

Though European sales only rose 8 percent to 52.3 million euros, the firm had seen a return of tourist trade and had felt an "upswing in March and April. Japan, with a 3.5 percent sales gain to 95.8 million euros, was marred in the quarter by delivery issues that Maury said had been resolved. She said sales there should gain some 8 to 10 percent for the year.

www.hermes.com
11 May 2005

The Birkin Legend

Have you ever wondered how a piece of stitched leather makes it to cult status, with fashionistas the world over clamouring for one of their own? How is it that one bag can capture the public's imagination to such an extent and inspire legions of copycats?

Fashionweekdaily.com went back in time to the roots of the legendary Birkin bag. According to some, it all started when actress Jane Birkin spilled the contents of her too-small bag onto the Hermes designer on a plane back in 1981, inspiring the designer to create the roomy new model.

In 1985, Barbara Guggenheim had begun collecting Kelly and Birkin bags, even before the bags had achieved the status of it-bag. In Mexico City, Mrs Guggenheim bought four Birkins and three Kellys. Many of us can only dream of this shopping scenario.

In the hit tv series, Sex and the City, Kim Cattrall's character, publicist Samantha Jones, claimed: "This bag screams, 'you've made it!'", catapulting the bag's status into an even higher stratosphere.

A few years later, both Martha Stewart and Lil'Kim arrived at their respective trials touting the ultra-luxurious totes. Stewart's lawyers filed for a new trial when it was revealed that the jury had discussed the price of her bag. At around EUR 4,000, it is little wonder the jury had such a reaction to Stewart's arm candy.

Last year, Jane Birkin herself was spotted at the Gaultier couture show with a Birkin bag. The media went wild. Earlier this year, in an interview with the New Statesmen, Birkin said: "People always want to talk about it (the bag). I just don't understand. It can get a bit much to be upstaged by a bag." Amen to that.

www.hermes.com
2 May 2005

Hermes profit drop

The luxury fashion house Hermes International SA has reported a full-year profit drop of 3.1 per cent. The company attributes the dip in profits to higher taxes and currency fluctuations. Hermes said that net profit totalled EUR 210.1 million (GBP 152.14 million) in 2004 compared with EUR 216.8 million in 2003.

Revenue for 2004 increased to EUR1.33 billion from EUR1.23 billion the year before.
Hermes invested a total of EUR118 million into the company in 2004 and is planning on opening five new outlets in 2005 as well as renovating ten of its existing stores. Hermes added that it would undertake measures to increase its production capacity.

www.hermes.com
29 March 2005

Carried Away

If you want to buy an Hermes Kelly back you will have to join a waiting list for up to a year. But that's not too long for a bag of this stature; hand-made in the Hermes workshop in Paris in grainery leather with gold fittings, priced at £2,800. Worth it when you consider that this is the perfect bag and a wise investment. It's resale value on eBay starts at £20,000 for your first bid…

8 November 2004

Gaultier fronts Hermès

Jean Paul Gaultier will replace Martin Margiela as chief designer at Hermès. Gaultier's first ready-to-wear line for the label will be for autumn 04. Hermes said the collaboration would not affect Gaultier's position within his own company, in which Hermès has a 35 per cent stake.

3 June 2003

Hermes to open 15 stores

French luxury goods company Hermes International reported a 6.8 per cent rise in 2002 net profit to GBP 147.8m. Hermes also announced the opening of 15 stores this year. The company's operating profit increased by 4.3 per cent to GBP 219.7m. Last month, Hermes posted a 1.3 per cent rise in turnover to GBP 0.8bn, advanced by sound sales in both Japan and the United States.

Hermes, which is based in Paris, opened five new stores last year, bringing the number of stores worldwide to 216. This year, the company plans to open 15 new stores and refurbish a number of existing stores. In order to speed up expansion in China, Hermes acquired a retail location in Hong Kong at the end of 2002.

The company would not specify its targets for the current year, but said it would "continue with its strategy to expand its distribution channels and production capacity despite a difficult geopolitical situation". The company also said it will build a new logistics centre in the Paris region, which is expected to be operational in the second quarter of 2003.

March 25, 2003