Hermès, the renowned French luxury brand, recently disclosed the impact of the ongoing COVID-19 pandemic on its first-half results. The company reported a significant decrease in net profits by 55 percent, totaling 335 million euros ($394 million). Operational profitability also took a hit, dropping to 21.5 percent of revenue from 34.8 percent in the previous year. Despite these unfavorable figures, Hermès managed to reach sales of 2.48 billion euros, meeting the expectations of industry analysts.
Axel Dumas, the Executive Chairman of Hermès, addressed the challenges encountered during this unprecedented crisis but remained optimistic about the brand’s future. Dumas highlighted the resilience of Hermès, emphasizing that the company prioritized the preservation of jobs and the sustenance of employees’ basic salaries worldwide without resorting to government aid.
Dumas underscored the key strengths that keep Hermès well-positioned for success, including its devoted clientele, coveted collections, adaptable omnichannel network, and the independence of the group. The Chairman noted a positive trend in sales starting to rebound in June, with China leading the way as all stores reopened in March, signaling strong growth.
Despite the uncertainties posed by the global health crisis, Hermès assured stakeholders of its robust financial standing and substantial cash reserves. The company’s strategic focus is on gradually boosting turnover to achieve ambitious targets, demonstrating a firm commitment to the enduring prosperity of the business.
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