(Updated with details and stock price)
PARIS, July 29 (Reuters) – Hermès sales rose sharply in the second quarter, thanks to rapid growth in Europe and the United States, and a stronger rebound than its rivals in China in June , the manufacturer of the Birkin bags said on Friday.
The Hermès title took 6.3% at 1221 GMT on the Paris Stock Exchange.
Luxury players have been strongly affected by the health restrictions put in place in mid-March in the main Chinese cities. Most of them reported a drop of more than 30% in quarterly sales in the country, a crucial market for the sector, at the start of the week.
Luxury groups LVMH and Kering have been cautious about the pace of recovery in China.
Hermès, also known for its more upbeat equestrian-print silk scarves, said sales in the Asian country saw double-digit growth in June and continued to do well in July.
The return of American tourists to Europe also contributed to the increase in sales.
The group’s turnover during the quarter amounted to 2.7 billion euros, an increase above forecast of 19.5% at constant exchange rates, which excludes currency fluctuations.
Hermès boosted its operating profitability above expectations, to a record level of 42% in the first half, the highest level in the sector, a considerable achievement given that the group has increased its prices less in recent months than LVMH. and Chanel.
The margin will decline in the second half, however, as Hermès is ramping up investment in e-commerce and advertising after events in China were suspended due to health restrictions.
The group does not plan to increase prices further in 2022 beyond the average increase of 4% already implemented to offset the soaring costs of raw materials and precious metals.
Luxury goods consumers have so far shrugged off the rising cost of living and worries about a possible recession, but industry executives have all acknowledged that the outlook for the rest of the year remains uncertain.
Hermès has long been one of the most stable companies in the luxury industry, thanks in part to its careful production and inventory management.
“This set of results confirms that Hermès is likely to be the most resilient player in the luxury sector in the event of a recession, and an appropriate hiding place for those seeking protection,” said Luca Solca, luxury analyst for consultancy Bernstein. .
(Reportage Mimosa Spencer; French version Diana Mandiá, edited by Kate Entringer)