The Only Luxury Brand Sailing Smoothly... Herm?s' Net Profit Up 28% Last Year

JP Morgan "Hermes Plays in a Different League"
Prices Expected to Rise 8-9% This Year

While the global luxury market is struggling due to weakening demand, Herm?s, famous for its multi-million won 'Birkin bags,' has shown growth.

Herm?s [Image source=Yonhap News]

According to major foreign media such as Bloomberg, Herm?s announced on the 9th (local time) that its net profit last year was 4.3 billion euros (about 6.2 trillion won), up 28% from the previous year, and sales rose 21% to 13.4 billion euros (19.2 trillion won).

In the fourth quarter of last year, sales increased by 18% year-on-year to 3.36 billion euros (4.8 trillion won), exceeding expectations (14%).

Herm?s' sales grew across all regions and performed well even in China, where recovery after COVID-19 was expected to be slow. Sales in the Asia-Pacific region, including Japan, the largest market, reached 7.5 billion euros (10.8 trillion won) last year. Japan saw a 15% increase in sales compared to the previous year, while the rest of the Asia-Pacific region grew by 13%. Sales growth rates in Europe and the Americas were 19% and 17%, respectively.

Reflecting these results, Herm?s announced it will pay a bonus of 4,000 euros (5.74 million won) to its 22,000 employees worldwide at the beginning of the year. Shareholders will receive a special dividend of 10 euros per share.

Axel Dumas, chairman of Herm?s, announced during the earnings release that the company plans to raise prices globally by 8 to 9% this year. Herm?s also raised prices by about 7% last year, citing increased production costs.

Among high-end brands, Louis Vuitton Mo?t Hennessy (LVMH), which owns Louis Vuitton and Christian Dior, and Richemont, which owns Cartier, showed improved performance, but Burberry and Kering, the parent company of Gucci, were relatively sluggish. JP Morgan evaluated, "Herm?s is playing in a different league."

This content was produced with the assistance of AI translation services.