Birkin bag maker Hermes says starting to see return to normal in China

27-Feb-2020 Intellasia | Reuters | 6:02 AM Print This Post

Birkin handbag maker Hermes said on Wednesday it was starting to see a return to normality in China, with just four of its 43 stores on the mainland and areas like Hong Kong and Macau still closed due to the coronavirus outbreak.

Luxury goods companies like Hermes are facing a sales hit from the outbreak as they have been forced to shutter shops and shelve advertising campaigns in the world’s second-largest economy. Chinese shoppers account for a third of the luxury goods industry’s clientele.

“Until 10 days ago we were in a situation of closing stores, now we are in a situation of re-opening them,” Hermes Chief Executive Axel Dumas told reporters, adding that it was too early to estimate the impact of the health crisis on its group.

The French firm, also known for its silk scarves, reported a slowdown in sales growth in the fourth quarter of 2019 to 1.87 billion euros ($2.03 billion), hit by protests in Hong Kong and the impact of a sales tax increase in Japan.

That was up 10.7 percent at constant exchange rates, broadly in line with analyst expectations, and compared with sales growth of 15 percent in the third quarter. ($1 = 0.9201 euros)


Category: China

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