Hermes reports sales leap

Luxury fashion group Hermes, known for silk scarves, reported on Tuesday a 22.6-percent rise in sales last year to 3.48 billion euros ($4.66 billion) and said that the operating margin had risen above the record of 31.2 percent in 2011. The company, which publishes its annual results on March 21, said that owing to excellent performance in the fourth quarter, its operating profit should be slightly higher than the figure achieved in 2011. The margin of 31.2 percent in 2011 was the highest achieved since the company, founded in 1837, was floated on the stock exchange in 1993. The sales figure exceeded expectations by analysts who had foreseen a figure of about 3.42 billion euros. Sales were boosted by activity in Asia where the company does most of its business and where it opened two new outlets, one in Taiwan and one in China. Hermes also enlarged six other outlets. Sales in Asia rose by 28.6 percent and, excluding Japan, they rose by 36.2 percent, notably owing to demand in China. In America, where the sales network was increased, sales rose by 22.5 percent. Sales in Europe, supported by demand from foreign tourists, rose by 15.4 percent. The board said it expected to pay 1.50 euros per share as part of the dividend on March 1. In 2011, shareholders had received 2.0 euros per share and an exceptional dividend of 5.0 euros. The company said that it was optimistic about the outlook for this year but did not make any forecasts. Group sales have doubled since 2008. In the fourth quarter of this year, performance far outstripped analysts' expectations. Sales rose by 22.5 percent or by 18.5 percent at constant exchange rates. From October to the end of December, sales totalled more than 1.0 billion euros.