Savings redirected to luxury spending

At Hermès, Asia ex-Japan saw an increase of 25.2% on a reported basis, with a "remarkable performance from mainland China, Korea, Australia and Thailand" and a recovery from Japan ( + 8.1%). The continent also supported the world leader in luxury, LVMH, with a 13% increase in organic growth in the third quarter. And over nine months Asia represents 34% of the group's revenues.

If the Far East clearly plays the role of locomotive, the two heavyweights have also found other relays. "The most accessible products from the most recognized brands have been a hit" in Europe and the United States as well, notes Arnaud Cadart. Because "in a crisis phase, this is where people come to have fun and spend the savings that were not used to travel, to go to the theater or to the restaurant".

In addition, “Hermès has reaped the benefits of its investments in online sales,” notes Arnaud Cadart. "E-commerce has become our first store in the group with growth" which is "close to triple digits", thus assured the financial director of Hermès, Eric du Halgouët.

A horizon still uncertain

On the stock market, investors clearly welcomed these results, with a bonus for the first to surprise, namely LVMH which jumped 7.34% on Friday in the wake of its results, dragging the entire sector in its wake. .

This Thursday, on the Parisian square, Hermès was one of the rare values ​​in the green. Its shares even sign the best performance of the CAC 40 since January 1 with an increase of more than 23%.

If the improvement is clearly there, the after-effects of the pandemic have not been completely erased and are more visible over nine months: with 4.288 billion euros, Hermès sales thus decline by 14.4% compared to the same period in 2019, while those of LVMH fell by 21% to 30.348 billion euros.

The two groups have also refrained from any triumphalism. "The economic and financial strength of Hermès allows the group to go through this crisis with serenity", assured Eric du Halgouët, while preferring to remain "cautious". For its part, LVMH had assured that "in a very disturbed context, marked by uncertainties, the group will continue to be vigilant".

The hope of Christmas

The latest news on the health front "weighs on confidence. China has clearly restarted, but it cannot function on its own, ”believes Arnaud Cadart. However, according to him, “the fourth quarter is that of the end of year celebrations, synonymous with massive purchases among Westerners. However, deprived of travel, people could continue to reorient themselves towards luxury, ensuring a good resistance to these last three months ”.

In 2019, LVMH recorded sales up 12% in the fourth quarter compared to the same period of 2018, to reach 15.2 billion euros. For Hermès, it was + 10.7% (1.8 billion euros) over this same period compared to that of 2018 and + 11.4% for Kering for a total sales of 4.3 billion euros (at constant exchange rates for both).