Earnings at Hermes flying as luxury market booms

HERMES unveiled record profit margins yesterday as the sale of luxury items continued to weather the overall consumer downturn.

The company, best known for its bags and scarves, saw a 49 per cent jump in half-year profits to €290.9m (£257.4m).

Sales were up by 22 per cent at €1.31bn, with jewellery and watches performing particularly strongly, Hermes said.

The Paris-based company said its US sales had proved resilient.

Hermes confirmed its full-year forecast, saying it expected sales growth of between 12 and 14 per cent for the year and that its operating margin would be “close to the record high” of 2010.

But chief executive Patrick Thomas warned that a lack of stock to meet demand in some product lines would have an impact.