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by Pascale Denis
PARIS (Reuters) – Hermes, which saw its organic growth accelerate in the second quarter thanks to leather goods and ready-to-wear, said tabler, for the semester, on a operating margin close to the record reached a year ago.
Sales of the group famous for its Birkin bags or its "squares" of silk reached 1.46 billion euros, showing an increase of 7.2% in published data, limited by adverse effects of the rise of the euro against the dollar.
But at constant exchange rates, growth came out at 11.6%, better than the 10.8% of the first quarter and the average 10% expected by badysts.
"Hermes has a very strong quarter, with growth still very healthy, especially driven by volumes," said Axel Dumas, manager of Hermes, at a conference call with the press
With these figures and posi The Group estimates that its current operating profitability for the first half of the year should be close to the record level (34.3%) achieved in the first half of 2017.
While some concerns have emerged regarding the evolution of Chinese demand, particularly related to the decline of the Shanghai Stock Exchange and real estate prices, Axel Dumas said he does not perceive "no inflection" of demand in China where Hermes "has experienced double-digit growth for several years."
Like many of its competitors, including Louis Vuitton, owned by LVMH, Hermes lowered its prices in China after the cut in tariffs announced by Beijing. The decline, which began in early July, was 4%, said Axel Dumas.
Asked about the effects of escalation in trade tensions between the United States and China, he said that "a war commercial would be bad for everyone "but that Hermes" will not be the first affected because its customers travel. "
SUCCESS OF JEWELERY
Hermes, which completes the first half of organic growth of 11.2 %, continues to rank among the best performers of luxury and far outperforms the market, which is estimated to increase between 6% and 8% by Bain and sees the gap between good and bad students widening.
"If Hermès' growth does not reach the expected pace at Gucci (Kering) or the LVMH fashion and leather goods division, its regularity continues to impress," say HSBC badysts.
Leather goods, the main division of the group, accelerated the pace in the second quarter and signed an increase of 8.4%, while its production capacity increased with the opening of a 16th manufacture in France. 19659002] Sales of clothing and accessories rose another 16.4%, thanks mainly to men's ready-to-wear and footwear, while the strongest growth came from "other trades", driven mainly by success.
Geographically, the saddler has held up well in France, where its sales climbed 10% despite the rise in the euro, while it shone in the United States, where its sales took off 16%. In Asia (excluding Japan), growth reached 13.4%.
After figures considered solid but without any real surprise, the Hermès share fell by 0.37% at 9:40, while the CAC 40 yields 0.14% at the same time.
The value that has integrated the index CAC 40 on June 18, has seen an increase of 22.5% since the beginning of January and its valuation multiples remain by far the highest in the sector, at 40.09 times the estimated results for 2019, against 23.32 for LVMH and 21.0 for Kering
It had reached a high of 2018 at 609.45 euros in anticipation of its entry into the flagship index of the Stock Exchange ..
Hermes will publish its half-year results on 12 September.
Those of LVMH are scheduled for July 24, with organic growth of its fashion and leather goods division expected around 13%. Kering, who will publish his own on July 26, should still see Gucci turn full speed and exceed 40%.
(Pascale Denis, edited by Jean-Michel Belot)
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