Hermes weathers storm
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Luxury goods retailer Hermes says a slowdown in sales in Hong Kong has been more than offset by solid Japanese trade.
Hermes International has reported a 22 per cent increase in second-quarter sales as growth in Japan took off, consumers finally opening their wallets on luxury goods after a long season of economic malaise.
The Parisian company said sales rose to 1.17 billion euros (US$1.27 billion). When currency exchange effects are removed from the result, sales climbed 10 per cent, two percentage points faster than in the preceding first quarter.
The company says wealthy Chinese are preferring to shop in Japan or Europe, rather than in Hong Kong as goods there are perceived to be cheaper, largely due to favourable currency exchange rates.
Hermes has seven stores in Hong Kong.
Questions & Answers
Q.What was Hermes' total sales figure for the second quarter, and how does this compare to the previous year?
What was Hermes' total sales figure for the second quarter, and how does this compare to the previous year?
Hermes International reported second-quarter sales of 1.17 billion euros. This figure represents a 22 per cent increase compared to the same period in the previous year, showing significant growth for the luxury goods retailer.
Q.Which region's strong performance helped to offset the decline in sales in Hong Kong?
Which region's strong performance helped to offset the decline in sales in Hong Kong?
Solid Japanese trade more than offset the slowdown in sales experienced in Hong Kong. Growth in Japan was significant, with consumers spending on luxury goods after a long period of economic difficulty.
Q.What is influencing wealthy Chinese consumers to shop in Japan or Europe instead of Hong Kong?
What is influencing wealthy Chinese consumers to shop in Japan or Europe instead of Hong Kong?
Wealthy Chinese consumers are choosing to shop in Japan or Europe because goods are perceived to be cheaper in these locations. This preference is largely attributed to favourable currency exchange rates currently available there.
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