Hermes enjoys strong watch sales in Q2

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Growth for luxury brand follows six new store openings worldwide.

Hermes has announced strong results for the second quarter, noting an increased taste for luxury among consumers which is boosting the firm’s global sales.

Revenues for the French fashion house rose by 21% to €1.3bn (£1.14bn). Profits have also been strengthened by the sale of a stake in Jean-Paul Gaultier’s fashion label.

Hermes is planning further growth with a programme of new store openings. It has already launched six new stores worldwide this year; a further ten will open in the remaining months of 2011.

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Pierre Lamelin, an analyst from CA Cheuvreux Paris, was quoted by Bloomberg as saying: "Hermes is well positioned in a buoyant luxury-goods market, delivering fast sales and earnings growth while maintaining its status as one of the most exclusive brands around."

The success of the spring-summer fashion accessories and ready-to-wear collections resulted in the highest sales growth for the quarter, up 31%, while watches and jewellery sales were described as ‘buoyant’ – both up 30%.

The US and China led the sales drive with the Americas growing by 34% and Asia (excluding Japan) by 30%. Europe saw sales increase by 20%.

But Hermes CEO Patrick Thomas raised concerns that the firm’s revenues could be hit by uncertain global economic conditions over the coming months.

Thomas has said: “Our business is highly psychological and when people feel there is a bad mood internationally, there is instability, there is a threat on the economy, then people buy less.”

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