After end of year results well above analyst predictions, the Paris-based luxury goods group continued to outperform rivals and bucked the trend in a depressed market place.
ADVERTISEMENTFrench fashion company Hermès announced its full year 2024 results on Friday. Consolidated revenue for the group came up to €15.2 billion last year, which was an increase of 15% at constant exchange rates, compared to 2023.
This was mainly due to a strong performance in the European market, although all the geographical areas saw good growth in 2024.
Hermès’ share price rose 0.85% on Friday afternoon.
Recurring operating income hit €6.2bn in 2024 whereas the group share of net profit came up to €4.6bn.
Adjusted free cash flow was €3.8bn in 2024, which was a rise of 18% from 2023.
Sales hit €4bn in the fourth quarter of 2024, which was also a hike of 18% at both current exchange rates and constant exchange rates.
Hermès’ market capitalisation shot up to around $300.1bn, moving closer to rival LVMH’s, at $357.6bn.
The group expanded its workforce by approximately 2,300 people in 2024, which also included about 1,300 employees in France.
Axel Dumas, executive chairman of Hermès, said in the full year 2024 earnings report on the company’s website: “In 2024, in a more uncertain economic and geopolitical context, the solid performance of the results attests to the strength of the Hermès model and the agility of the house’s teams, whom I thank warmly.
“While preserving the group’s major balances and its responsibility as an employer, the house is staying the course, attached more than ever to its fundamental values of quality, creativity and savoir-faire.”
Russ Mould, investment director at AJ Bell, said: “Hermès shares jumped on better-than-expected sales. Japan was the star of the show, with the luxury goods company saying it benefited from loyal clients.
“It was enough to trigger a rally across the luxury sector, with the likes of Burberry, Richemont and LVMH moving higher on hopes that wealthy individuals were back in spending mode.”
Euronews has contacted Hermès for comment.
Hermès sees strong European and Americas performance
Hermès’ European market, excluding France, experienced sales growth of 19% in 2024. Sales in the French market grew 13%.
This was primarily because of strong demand, as well as local consumers continuing to show their loyalty. Sales due to tourism also contributed to growth.
ADVERTISEMENTHermès opened a new store in Lille back in November 2024 and reopened an expanded and renovated outlet in Naples in December. The company also reopened the extended and renovated Nantes store in June 2024.
The Americas experienced a sales surge of 15% in 2024, with Atlanta’s store opening again in October following renovation and expansion. A new outlet was also launched in Princeton, New Jersey in April.
Sales in Asia, not including Japan, rose 7% in 2024 as sales stayed strong in all the region’s countries. In the fourth quarter, sales grew 9%, despite greater China traffic falling since the end of Q1 2024.
Singapore’s newly expanded and renovated Takashimaya outlet reopened in October, while Japan recorded a 23% increase in sales in 2024.
ADVERTISEMENTComing to individual sectors, the leather goods and saddlery department saw a sales hike of 18%, mainly because of rising production capacities and robust demand.
Similarly, the ready-to-wear and accessories department jumped 15%, boosted by the popularity of the ready-to-wear and shoe collections.
The silk and textiles division inched up 4%, driven by good performance in both the men’s and women’s segments.
The perfume and beauty department also advanced 9%, boosted by demand for the new women’s perfume Barénia.
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