PARIS -- While Hermes International had a stellar year last year, posting strong double-digit growth for sales and profits, perfumes remained a weak spot.
Hermes's perfume division, Comptoir Nouveau de la Parfumerie, widened its loss in 1993 to $4.9 million (27.5 million francs) last year. In 1992, the perfume operation posted a loss of 1.4 million francs.
Sales for Hermes perfumes dropped 11 percent in 1993, to roughly $38.1 million (213.8 million francs).
Details of Hermes's 1993 performance were presented Tuesday at the company's first annual meeting here by chairman Jean-Louis Dumas. As the company earlier reported, overall net profit for Hermes rose 19 percent last year to $37.4 million (210 million francs), and consolidated sales rose 16 percent to $507.3 million (2.85 billion francs). Double-digit growth was achieved in all of the company's markets. Sales in the U.S., which account for 11 percent of total, rose 15 percent last year.
The company's sales for the first quarter of this year were up 32 percent, to $135.1 million (759 million francs) from the year-earlier period.
Dumas attributed the poor performance in perfumes to heightened competition in the international marketplace. He also said Hermes's own distribution into certain markets was limited. As a result, Hermes signed an agreement last year with Clarins group in Paris to distribute the fragrances in Italy and Switzerland. This accord is similar to the one Hermes already has with Shiseido for the Japanese market.
As with some of the other Hermes products, perfume sales were strongest in the firm's wholly owned stores. Volume was soft outside that network in part because of a lack of advertising and marketing effort, Dumas said.
"Product launches at other companies helped them compensate for the drop-off of sales for their existing perfumes," he said, adding that Hermes had no launch last year but is preparing one for the end of this year.
While the market launch for a women's fragrance is still on schedule for the fourth quarter, the press presentation, which had been tentatively scheduled for June, has been pushed back to early September.
"We just thought June was too early," said Marie-Jeanne Chevallereau, chairman of the perfume arm, explaining that the perfumes would not yet have gone on sale then. "Also, there are a lot of magazines and newspapers that have big back-to-school editions showing all the new products, and we don't want to be mixed with all that."
A Stella McCartney sketch of a custom dress made from protein-based silk in partnership with biotech lab Bolt Threads. The dress will be displayed at The Museum of Modern Art's upcoming design exhibition, "Items: Is Fashion Modern?"