This post was originally published on this site
https://i-invdn-com.investing.com/news/LYNXMPED2L0CR_M.jpg
Investing.com — Shares in Hermès International SCA (EPA:HRMS) climbed on Thursday after the luxury products retailer posted a sharp rise in third-quarter sales and laid out plans to increase prices in 2023.
Revenue for the three-month period up to September 30 grew by 32.5% at current exchange rates to €3.14 billion, as demand momentum in the French company’s key Chinese market remained strong despite temporary store closures in the country due to COVID-19 restrictions.
Shoppers in China particularly moved to snap up Hermès’ leather goods, which include well-known items like Birkin tote bags.
The stronger U.S. dollar also led to more spending by foreign tourists, especially in France, the U.K., and Italy.
Meanwhile, Hermès executive vice president of finance Eric du Halgouet told reporters that the Paris-based design house will hike the price tag for its products by between 5% and 10% next year, arguing that it is a necessary response to currency fluctuations and rising costs.
The decision also echoes the resilient optimism over the demand outlook for the luxury sector outlined by rival LVMH (EPA:LVMH) last week, analysts at Bernstein noted.
Elsewhere, Pernod Ricard (EPA:PERP) upped its prices by 7% globally in the July-September period, with the drinks maker’s finance chief saying that there was no slowdown in consumer demand in the U.S., the world’s largest luxury market.
These price rises came with a better-than-expected jump in quarterly sales for Pernod, as Chinese shoppers also flocked to buy products made by the spirits group behind premium options like Absolut vodka and Beefeater gin.
Pernod added that sales would remain dynamic over the rest of its fiscal year, though growth is seen “moderating” amid a volatile trading environment marked by the war in Ukraine, soaring inflation and COVID-19 restrictions in China.
Shares in Pernod dropped on Thursday.
