In August 28th, Hermes announced that the first half of its business profit was nearly 33% in the first half of the year and 28% five years ago. The performance of LVMH flagship brand Louis Vuitton is also very good, but the profit growth of its fashion and leather sector has declined from 33.7% in 2015 to 25.1% in the first half of this year. Business profits in the first half of Gucci grew at 27%.
In addition, the performance of Hermes is better in the “difficult” areas such as Asia. Like other colleagues, Hermes has a risk exposure in Asia, but it seems to be the beneficiary by avoiding excessive expansion. Specific data show that the annual growth rate of Hermes Asia (excluding Japan) is still close to 7%. In Ulan Bator, we can’t find the Hermes store at all.
However, Hermes’s share price has fallen by 10% since August 10th in the context of the global luxury sector’s poor performance. But, Hermes has done very well. The high end brand persists, that is, “less is more”, which makes Hermes a “rare asset” in the global luxury sector.