Hermes International: Release on 3rd quarter 2022 sales
HERMÈS
Quarterly information report as at the end of
September 2022
A very good sales momentum continues in
the 3rd quarter
(+32.5% at current exchanges rates and
+24% at constant exchange rates)
Paris, 20 October 2022
The group’s consolidated revenue amounted to
€8,611 million at the end of September 2022, up 30% at current
exchange rates and 24% at constant exchange rates compared to the
same period in 2021.
In the third quarter, sales reached €3,136
million, up 32.5% at current exchanges rates and 24% at constant
exchange rates, with strong growth in all the business lines.
Axel Dumas, Executive Chairman of Hermès, said:
“The strong performance in the third quarter reflects the
desirability of our collections all around the world and the
relevance of our values. We move forward with confidence and
caution while continuing to bolster our integrated model, rooted in
France and committed to job creation. Our success lies in that of
our teams, whom I would like to sincerely thank.”
Sales by geographical area at the end of
September
(at comparable exchange rates, unless otherwise
indicated)
At the end of September 2022, all the
geographical areas posted very strong performances. Sales in
group’s stores (+23%) benefitted from the reinforcement of our
exclusive distribution network and online sales. Wholesale
activities growth (+26%) reflected the resumption of travel
retail.
- Asia excluding Japan (+21%) continued its strong momentum,
thanks to an excellent 3rd quarter (+34%). Sales in Greater China
picked up strongly, despite temporary closures due to sanitary
measures mainly in Macau, Chengdu and Dalian in July and August.
Sales were particularly sustained in Singapore, Australia, Thailand
and Korea. After the Pacific Place store in Hong Kong and One
Central store in Macau at the beginning of the year, the Greenbelt
Mall store in Manilla and Wuhan store in China reopened after
renovation and extension in July.
- Japan (+21%) confirmed the regularity and solidity of its
growth, thanks to the loyalty of local clients. In Ginza, the Men’s
universe floor re-opened in September after renovation. In June,
the La Fabrique de la légèreté exhibition, featuring the theme of
the year, was very well received in Tokyo.
- Americas (+28%) continued on an upward trend in the 3rd
quarter. In the United States, after the opening of a new store in
Austin in April, a new Maison was inaugurated at 706 Madison Avenue
in New York at the end of September. This store offers a unique
experience: the private salons recreate a sense of intimacy and
exclusivity within a large welcoming space enhancing the
collections. The House reiterated its commitment to objects’
sustainability with a floor dedicated to repairs by Hermès
artisans. The HermèsFit event was held in Los Angeles in July,
highlighting silk, shoes, small leather goods and fashion
accessories collections.
- Europe excluding France (+25%) and France (+28%), supported by
the loyalty of local customers, benefitted from the recovery in
tourist flows, especially in France, the United Kingdom and Italy.
In July, the Faubourg Saint-Honoré store in Paris presented the
seventh jewellery collection Les jeux de l’ombre, which was very
well received.
Sales by business line at the end of
September
(at comparable exchange rates, unless otherwise
indicated)
At the end of September 2022, all the business
lines confirmed their high levels of sales, with Ready-to-wear and
Accessories, Watches and Other Hermès business lines posting a
remarkable increase in the third quarter, confirming Hermès’ great
attractiveness.
The growth of the Leather Goods and Saddlery
division (+13%) benefitted from the strong rebound in Greater China
in Q3 and very sustained demand. The increase in production
capacities continues, with five leather workshops projects. The
first stone of the site in the former manufacture des Tabacs of
Riom (Puy-de-Dôme) was laid in September. It is part of an
industrial rehabilitation to reduce the project’s carbon footprint
and will constitute, with the Sayat leather goods workshop, the
second site of the Auvergne regional hub. Hermès thus continues to
strengthen its local presence in France and to create jobs.
The Ready-to-Wear and Accessories division
(+38%) pursued its strong momentum, thanks to the success of the
ready-to-wear, fashion accessories and footwear collections. The
women’s spring-summer 2023 fashion show presented in early
Octoberunveiled a collection inspired by a sporting spirit. It
received a very warm welcome, like that of the men’s collection in
June. The fashion accessories have met with great success, around
creations combining multiple know-how.
The Silk and Textiles business line (+27%)
achieved a great performance, supported by new production
capacities at the Pierre-Bénite site in Lyon and collections
deployed around a diversity of materials, formats and exceptional
pieces.
Perfume and Beauty (+18%) benefitted from the
success of the latest launches such as the eau de parfum H24, with
a new vegetal intensity. The Beauty collection launched the new
Fall-Winter 2022 limited editionswith three lipsticks and two nail
polishes in flamboyant colours.
The Watches business line (+55%) confirmed its
remarkable performance thanks to the development of pieces with
exceptional know-how such as the Arceau, Le temps voyageur watch
and the success of the new H08 watch and its pillar lines such as
Cape Cod and Heure H, around a watch collection where technique
echoes aesthetics.
Other Hermès sectors (+31%) pursued their highly
dynamic growth, both in Homeware and Jewellery, with creative and
inventive collections.
A responsible, sustainable
model
True to its values as a responsible employer,
Hermès accelerates its recruitment in the second half of the year.
After the gross monthly increase of €100 in January in France to
limit the effects of inflation, in addition to the annual
increases, and the exceptional bonus of €3,000 paid to all group
employees in February, the group again increased by €100 gross
monthly all salaries in Europe from July.
The École Hermès des savoir-faire, accredited by
the French Education Ministry, has already trained more than 150
artisans since its foundation in June 2021 and continues to develop
in all the regional leather goods workshops across the country in
Fitilieu, in the Ardennes, and then soon in the Normandy,
South-West and Auvergne hubs.
Attached to its artisanal production model and
its spirit of innovation, Hermès continues to grow while
controlling its energy footprint. The industrial energy intensity
of the house has halved in ten years. In line with its commitment
to a trajectory below 1.5°C, validated by the Science Based Target
initiative (SBTi), the House has stepped up since 2020 its actions
to fight against climate change, in particular through the
exclusive supply of electricity green, produced on the national
territory, of all the sites located in France.
Thanks to its Fondation d’entreprise, Hermès is
expanding its sponsoring activities through artistic creation,
education and transmission, solidarity and the preservation of
biodiversity. As such, the five-year commitment for the fourth term
will be formalised by the end of 2022.
Highlights
At the end of September 2022, currency
fluctuations represented a positive impact of €451 million on
revenue.
During the first nine months, Hermès
International bought back 104,269 shares for €116 million,
excluding transactions completed within the framework of the
liquidity contract.
Outlook
For 2022, the impacts of the sanitary, economic
and geopolitical context are still difficult to assess. Our highly
integrated craftsmanship model and balanced distribution network,
as well as the creativity of the collections and clients’ loyalty
allow us to look to the future with confidence.
In the medium-term, despite the economic,
geopolitical and monetary uncertainties around the world, the group
confirms an ambitious goal for revenue growth at constant exchange
rates.
Thanks to its unique business model, Hermès is
pursuing its long-term development strategy based on creativity,
maintaining control over know-how and singular communication.
The press release on Revenue at the end of
September 2022 is available on the Group's website:
https://finance.hermes.com.
Upcoming events:
- 17 February 2023: 2022 full-year results publication
- 14 April 2023: Q1 2023 revenue publication
- 20 April 2023: General Meeting of Shareholders
REVENUE BY GEOGRAPHICAL AREA
(a)
|
|
As of Sept. 30th |
Evolution /2021 |
In
millions of euros |
|
2022 |
2021 |
Published |
At constant exchange rates |
France |
|
753 |
587 |
28.2% |
28.2% |
Europe
(excl. France) |
|
1,123 |
904 |
24.2% |
24.6% |
Total Europe |
|
1,876 |
1,492 |
25.8% |
26.1% |
Japan |
|
822 |
710 |
15.8% |
21.2% |
Asia-Pacific (excl. Japan) |
|
4,242 |
3,226 |
31.5% |
21.1% |
Total Asia |
|
5,064 |
3,936 |
28.7% |
21.1% |
Americas |
|
1,518 |
1,061 |
43.1% |
28.3% |
Other |
|
153 |
114 |
33.9% |
32.9% |
TOTAL |
|
8,611 |
6,602 |
30.4% |
23.6% |
|
|
3rd quarter |
Evolution /2021 |
In
millions of euros |
|
2022 |
2021 |
Published |
At constant exchange rates |
France |
|
273 |
246 |
10.9% |
10.9% |
Europe
(excl. France) |
|
427 |
382 |
11.6% |
12.2% |
Total Europe |
|
700 |
629 |
11.3% |
11.7% |
Japan |
|
276 |
241 |
14.6% |
22.7% |
Asia-Pacific (excl. Japan) |
|
1,577 |
1,073 |
47.0% |
33.7% |
Total Asia |
|
1,853 |
1,314 |
41.1% |
31.7% |
Americas |
|
536 |
393 |
36.4% |
18.1% |
Other |
|
47 |
32 |
47.5% |
45.8% |
TOTAL |
|
3,136 |
2,367 |
32.5% |
24.3% |
(a) Sales by destination.
REVENUE BY SECTOR
|
|
As of Sept. 30th |
Evolution /2021 |
In
millions of euros |
|
2022 |
2021 |
Published |
At constant exchange rates |
Leather Goods and Saddlery (1) |
|
3,663 |
3,076 |
19.1% |
12.5% |
Ready-to-wear and Accessories (2) |
|
2,377 |
1,635 |
45.4% |
38.1% |
Silk
and Textiles |
|
579 |
433 |
33.8% |
26.7% |
Other
Hermès sectors (3) |
|
1,023 |
736 |
39.1% |
30.5% |
Perfume and Beauty |
|
344 |
288 |
19.3% |
17.5% |
Watches |
|
401 |
242 |
66.0% |
55.3% |
Other
products (4) |
|
224 |
193 |
15.9% |
13.4% |
TOTAL |
|
8,611 |
6,602 |
30.4% |
23.6% |
|
|
3rd quarter |
Evolution /2021 |
In
millions of euros |
|
2022 |
2021 |
Published |
At constant exchange rates |
Leather Goods and Saddlery (1) |
|
1,305 |
1,077 |
21.1% |
13.2% |
Ready-to-wear and Accessories (2) |
|
919 |
610 |
50.7% |
42.0% |
Silk
and Textiles |
|
208 |
159 |
30.7% |
22.9% |
Other
Hermès sectors (3) |
|
375 |
273 |
37.3% |
27.1% |
Perfume and Beauty |
|
113 |
104 |
9.2% |
7.4% |
Watches |
|
139 |
83 |
67.7% |
55.2% |
Other
products (4) |
|
77 |
61 |
25.9% |
22.8% |
TOTAL |
|
3,136 |
2,367 |
32.5% |
24.3% |
(1) The “Leather Goods and Saddlery” business
line includes bags, riding, memory holders and small leather
goods.
(2) The “Ready-to-wear and Accessories” business
line includes Hermès Ready-to-wear for men and women, belts,
costume jewellery, gloves, hats and shoes.
(3) The “Other Hermès sectors” include Jewellery
and Hermès home products (Art of Living and Hermès Tableware).
(4) The “Other products” include the production
activities carried out on behalf of non-group brands (textile
printing, tanning…), as well as John Lobb, Saint-Louis and
Puiforcat.
REMINDER – PREVIOUS
PUBLICATION
REVENUE BY GEOGRAPHICAL ZONE
(a)
|
|
First half |
Evolution /2021 |
In
millions of euros |
|
2022 |
2021 |
Published |
At constant exchange rates |
France |
|
480 |
341 |
40.7% |
40.7% |
Europe
(excl. France) |
|
696 |
522 |
33.4% |
33.8% |
Total Europe |
|
1,176 |
863 |
36.3% |
36.5% |
Japan |
|
546 |
469 |
16.4% |
20.4% |
Asia-Pacific (excl. Japan) |
|
2,665 |
2,153 |
23.8% |
14.9% |
Total Asia |
|
3,211 |
2,622 |
22.5% |
15.9% |
Americas |
|
982 |
668 |
47.0% |
34.1% |
Other |
|
106 |
82 |
28.7% |
28.0% |
TOTAL |
|
5,475 |
4,235 |
29.3% |
23.2% |
(a) Sales by destination.
REVENUE BY SECTOR
|
|
First half |
Evolution /2021 |
In
millions of euros |
|
2022 |
2021 |
Published |
At constant exchange rates |
Leather Goods and Saddlery (1) |
|
2,358 |
1,999 |
18.0% |
12.1% |
Ready-to-wear and Accessories (2) |
|
1,458 |
1,025 |
42.3% |
35.9% |
Silk
and Textiles |
|
372 |
274 |
35.6% |
29.0% |
Other
Hermès sectors (3) |
|
648 |
462 |
40.2% |
32.5% |
Perfume and Beauty |
|
230 |
184 |
24.9% |
23.3% |
Watches |
|
262 |
159 |
65.2% |
55.3% |
Other
products (4) |
|
146 |
132 |
11.1% |
9.1% |
TOTAL |
|
5,475 |
4,235 |
29.3% |
23.2% |
(1) The “Leather Goods and Saddlery” business
line includes bags, riding, memory holders and small leather
goods.
(2) The “Ready-to-wear and Accessories” business
line includes Hermès Ready-to-wear for men and women, belts,
costume jewellery, gloves, hats and shoes.
(3) The “Other Hermès sectors” include Jewellery
and Hermès home products (Art of Living and Hermès Tableware).
(4) The “Other products” include the production
activities carried out on behalf of non-group brands (textile
printing, tanning…), as well as John Lobb, Saint-Louis and
Puiforcat.
REMINDER – FIRST HALF 2022 KEY
FIGURES
In millions of euros |
H1 2022 |
FY 2021 |
H1 2021 |
|
|
|
|
Revenue |
5,475 |
8,982 |
4,235 |
Growth at current exchange rates vs. n-1 |
29.3% |
40.6% |
70.2% |
Growth at constant exchange rates vs. n-1 (1) |
23.2% |
41.8% |
76.7% |
|
|
|
|
Recurring operating income (2) |
2,304 |
3,530 |
1,722 |
As a % of revenue |
42.1% |
39.3% |
40.7% |
|
|
|
|
Operating income |
2,304 |
3,530 |
1,722 |
As a % of revenue |
42.1% |
39.3% |
40.7% |
|
|
|
|
Net profit – Group share |
1,641 |
2,445 |
1,174 |
As a % of revenue |
30.0% |
27.2% |
27.7% |
|
|
|
|
Operating cash flows |
2,001 |
3,060 |
1,487 |
|
|
|
|
Investments (excluding financial investments) |
190 |
532 |
214 |
|
|
|
|
Adjusted free cash flow (3) |
1,421 |
2,661 |
1,236 |
|
|
|
|
Equity – Group share |
10,259 |
9,400 |
8,024 |
|
|
|
|
Net cash position (4) |
7,293 |
6,695 |
5,326 |
|
|
|
|
Restated net cash position (5) |
7,685 |
7,070 |
5,521 |
|
|
|
|
Workforce (number of employees) |
18,428 |
17,595 |
16,966 |
(1) Growth at constant exchange rates is
calculated by applying the average exchange rates of the previous
period to the current period's revenue, for each currency.
(2) Recurring operating income is one of
the main performance indicators monitored by the group's General
Management. It corresponds to the operating income excluding
non-recurring items having a significant impact likely to affect
the understanding of the group's economic performance.
(3) Adjusted free cash flow corresponds to
the sum of operating cash flows and change in working capital
requirement, less operating investments and repayment of lease
liabilities, as per IFRS cash flow statement.
(4) The net
cash position includes cash and cash equivalents on the asset side
of the balance sheet, less bank overdrafts presented within the
short-term borrowings and financial liabilities on the liability
side of the balance sheet. It does not include lease liabilities
recognised in accordance with IFRS 16.
(5) The
restated net cash position corresponds to the net cash position,
plus cash investments that do not meet IFRS criteria for cash
equivalents as a result of their original maturity of more than
three months, minus borrowings and financial liabilities.
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