French luxury goods group Hermes said on Wednesday it was starting 2017 on a solid footing after delivering record 2016 profits, providing further evidence of a broader recovery in the luxury goods industry. Chief Executive Axel Dumas nevertheless struck a cautious note for the year given underlying global political and economic uncertainties. Hermes, known for its US$10,000 Birkin bags and US$400 printed silk scarves, said net profits had risen by 13 percent rise to a record €1.1 billion (US$1.19 billion). The company's sales growth had mainly stemmed from a strong performance at its leather goods arm, which makes 50 percent of group sales, while other divisions also performed well although its watches unit lagged. Several analysts expect the luxury goods sector to benefit in 2017 from improved consumer sentiment in China, tax cuts under the new US administration and robust Middle Eastern demand due to firmer oil prices.

Source: Egypt Independent March 22, 2017 08:37 UTC