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Hermès FY Net Profit Rises 15% to 1.4 Billion Euros

Hermès International said net profit rose 15 percent in 2018 as Asian consumers flocked to its stores, prompting the company to hire more staff and open additional leather goods workshops to keep up with demand.

The maker of Birkin bags and silk scarves posted a net profit of 1.4 billion euros ($1.6 billion) last year, with sales rising 7.5 percent to 5.96 billion euros. At constant exchange rates, revenues were up 10.4 percent.

Axel Dumas, CEO, said the signs so far this year are encouraging. “We see no change in trend,” he told analysts and reporters at a press conference at the brand’s headquarters. Hermès said operating profit increased 6.4 percent to 2 billion euros, with an operating margin of 34.3 percent, down from 34.6 percent the previous year. The company cited “particularly healthy growth and good cost control.”

The French luxury firm will propose a dividend of 4.55 euros a share at its general meeting on June 4. It has also announced payment of an exceptional bonus of 1,000 euros to all employees who earned less than three times the annual minimum wage in 2018, and will boost monthly paychecks in France by 100 euros.

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This story was reported by WWD and originally appeared on WWD.com.

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