- Prachi Singh |
In 2016, Hermès said, in a difficult context, the company's consolidated revenue passed the 5 billion euros (5.3 billion dollars) threshold, amounting to 5, 202 million euros (5,538 million dollars), up 7.5 percent at current exchange rates, and 7.4 percent at constant exchange rates. The company added that sales growth was sustained in the fourth quarter with 8 percent rise at current exchange rates and 7 percent at constant exchange rates.
All geographies posted increase in sales
Hermès said solid rise in revenue recorded in 2016 in group stores of 8 percent was driven by growth in all geographies. The company opened four new stores and carried out several renovations and extension works during the year. Revenues in Japan increased 9 percent, while Asia excluding Japan saw sales growth of 7 percent, particularly with extensions of the Liat Towers and Takashimaya stores in Singapore and store openings in Macao, at Hong Kong Airport and in Chongqing in China.
Sales in America rose 7 percent. The company’s stores in Hawaii and Philadelphia were renovated and extended at the end of the year. Europe posted 8 percent sales growth. Revenues in France increased 5 percent.
Annual revenue driven by leather goods and saddlery segment
The company said, sales growth over the year was driven by the success of leather goods and saddlery products and otherwise, sales benefitted from a positive momentum at year end in certain sectors such as silk and the ready-to-wear and accessories division. Growth in leather goods and saddlery was 14 percent, while the ready-to-wear and accessories division was stable over the year and posted a 4 percent increase in the 4th quarter, driven by the success of the latest women's ready-to-wear and fashion accessories collections, particularly shoes.
The silk and textiles business line sales dropped 1 percent, after being penalised by events in Europe and by slowing sales in Greater China during the first half of the year. Perfumes posted 9 percent growth. The watches business line with a 3 percent decline in sales was penalised by a still challenging market and a high comparison basis at year-end. Other Hermès business lines, which encompass jewellery, Art of Living and Hermès Table Arts reported 2 percent sales rise.
Expects operating profitability to be higher in FY16
For the full year 2016, the company expects operating profitability should be slightly higher than in 2015. 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.
On February7, 2017, management decided to pay an interim dividend of 1.5 euros (1.60 dollars) per share.