Luxury fashion brand Hermes has reported its highest ever annual sales and net profit, generating plans to reward its employees with bonuses. The French luxury giant achieved a better-than-expected profit of €4.3bn ($4.6bn), representing a 28% increase from the previous year, with sales rising by 16% to €13.4bn.

Axel Dumas, the executive chairman of Hermes, expressed his satisfaction with the brand’s exceptional performance, stating that the company had achieved outstanding results globally. Consequently, the company has decided to distribute the benefits of this growth amongst its 22,000 employees worldwide by providing them with a €4,000 bonus.

In addition to the employee bonuses, Hermes intends to propose an increase in dividends for its shareholders. The announcement of the record profits has also had a positive impact on the company’s stock price, resulting in shares in Hermes experiencing a more than 4% hike to €2,168 at the Paris stock exchange. This increase has propelled the brand ahead of cosmetics giant L’Oreal in terms of market capitalisation.

However, L’Oreal’s stock price plummeted by over 7% to €420 after reporting lower-than-expected results for the fourth quarter. Shares in LVMH, the world’s largest luxury goods group, also experienced a slight decrease of 0.3% to €802, despite reporting record annual earnings last month. Meanwhile, Gucci owner Kering witnessed a 0.7% increase in its stock price to €412, a day after reporting a decline in profits.

Looking towards 2024, Hermes has confirmed an ambitious goal for revenue growth at constant exchange rates. The company plans to propose a dividend increase to €15 per share, up from €13 in 2022, at its next general meeting in April. Additionally, an exceptional dividend of €10 per share will also be suggested.

In conclusion, the record profits and employee bonuses demonstrate a strong belief in the brand’s future. With remarkable performance in all areas and regions, Hermes is well-positioned for continued success in the luxury fashion industry.

Useful links:
Hermes Official Website
Hermes Stock Information