Hermes Results Beating Targets on Strong China Demand & Popular New Releases

Despite several months of pro-democracy protests in Hong Kong forcing Hermes to temporarily shut stores in key shopping hubs, Woozle continues to hold a long/buy recommendation on the stock as recent channel checks show continued momentum in underlying fundamentals.


Our interview research continues to suggest robust demand for the brand as strong responses to new releases and effective social media marketing drove footfall and average ticket trends across Mainland China and EMEA regions, with the majority of locations likely exceeding targets for the period.


Hermes stores across Asia, EMEA and US regions continue to see notable improvements in perforamnce across Q3 and the start of Q4 with the majority of interviews in our sample exceeding targets for the period.


Stores across Mainland China drove performance for the group with c. 13% growth in LFLs as further repatriation of luxury spending and sustained demand for higher-end labels saw sales above targets for the period.


Locations across EMEA regions also are seeing strong SSS trends with c. 7% growth as a result of higher levels of tourist activity from Asian regions, while US stores are seeing slightly more mixed results with LSD growth YOY.


Respondents widely report greater footfall from younger customers that is driving overall store performance, with new collection releases across Leather Goods and RTW categories seeing strong demand and performing above expectations.


Key research highlights underpining our long recommendation include:

  • Stronger Fundamentals Through Q3 & Start of Q4-19

  • Interviews continue to suggest Strong LFL Growth; Trending Above Targets.

  • Significant Improvement In Response To New Releases On Greater Variety & Appeal To Younger Demographic

  • Handbags & Ready-to-Wear Drive Store Sales; Accessories & Fragrances See Accelerating Demand

  • Large Increases In Cost Prices With No Adverse Impact On Demand

  • Robust Demand Across Asian Regions

  • Popular New Releases Trending Above Expectations

To see a copy of our latest long/buy report on Hermes contact our led Softline Luxury analyst at

Request More Info