Hermes, the renowned maker of Birkin bags, has announced its optimistic outlook for 2024 after experiencing a surge in fourth-quarter sales, despite the overall slowdown in the luxury market.
In the last three months, the French luxury-handbag maker recorded revenues of €3.36 billion ($3.62 billion), marking a substantial 17.5% increase at constant exchange rates compared to the previous year. This impressive figure surpassed analysts’ expectations of €3.26 billion, according to the Visible Alpha consensus.
Notably, all regions reported double-digit revenue growth for the final quarter, with Asia emerging as the primary contributor, generating €1.72 billion in group revenue.
Hermes’s operating profit for 2023 also witnessed a significant rise, reaching €5.65 billion compared to €4.7 billion in the previous year. In addition, net profit experienced a notable leap of 28% to €4.31 billion.
Despite economic uncertainties at the global level, including factors such as geopolitical tensions and monetary fluctuations, the company remains confident about achieving its ambitious goal of constant exchange rate revenue growth in the medium-term.
To reward its shareholders, Hermes plans to propose a dividend of €15 per share for 2023, a notable increase from the previous year’s €13 per share. Moreover, an exceptional dividend of €10.00 per share will also be offered.
The luxury industry’s earnings season has been a mixed bag thus far, but companies catering to high-end clientele have generally fared better.