Hermes and Ferragamo see profits rise thanks to wealthy Asian shoppers

Record numbers of well-heeled tourists flock to Europe's luxury stores to snap up top-of-the-range bags and shoes

The economic gloom still hanging over Europe has not stopped wealthy Asian shoppers boosting the coffers of some of the most expensive luxury brands in the world.

They are flocking to bag-to-belt maker Hermes and Italian shoemaker Ferragamo in record numbers, with both companies reporting a boost in sales and profits.

Hermes, best known for its £4,500 Birkin bag favoured by Victoria Beckham and Julia Roberts, saw sales rise 11% to €1.77bn (£1.5bn) as operating profits soared 14% to €584.1m for the first half of the year.

The results gave the group an impressive 33% profit margin, which would be a record for the company if it is maintained for the rest of the year.

Demand for silk scarves was strong, with Asian customers particularly keen to keep up the insatiable appetite for luxury goods in the Far East. However, watch sales fell.

Sales in Asia, excluding Japan, grew 17%, but rose by 13% in France and 15% in the rest of Europe thanks in part to Asian tourists taking items back home.

Luxury shoemaker Ferragamo also saw a healthy boost in sales, up 11% to €625m (£533m), as Asian shoppers and well-heeled tourists in Europe snapped up its wares.

The Asia Pacific region is now the best-selling area for the company, which counts Lady Gaga and Angelina Jolie among its fans, accounting for 38% of sales – up 13%.

European sales rose 14% and accounts for 26.7% of the total, but the company put the surprise rise down to wealthy Asian, Russian and Middle Eastern tourists. Net profits for the first six months of the year rose 81% to €81m.

Several prominent luxury brands have reported strong sales across Asia, or see Asian tourist customers as a key driving force for their businesses.

Last month Kering Group, owner of Gucci, Yves Saint Laurant and Bottega Veneta, saw sales in China jump 19%, while British brand Burberry recently revealed double digit growth in China and the opening of two new Shanghai stores.

The Chinese city has become a firm favourite for international retailers hoping to break into the Chinese market and another retailer joined them on Friday.

Floral print design brand Cath Kidston said it will open a three-storey 557 sq m (6,000 sq ft) store on Huai Hai Road selling a full range of homeware, accessories, clothing and childrenswear.

The company is so popular in Asia, it now has more stores in the Far East than it has in the UK for the first time. © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds

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