PARIS — Hermès International is sticking to pre-crisis payment terms for suppliers, the French luxury house said Friday.
Answering written questions from shareholders at the annual general meeting, the company said it has not changed its conventional payment terms, which are often shorter than legal requirements—20 days on average—and ensuring invoices are paid as soon as possible.
The company added it regularly makes advance payments, at the outset of projects.
Payment delays have become widespread amid the economic disruption from the coronavirus.
Hermès has offered a picture of resilience amid the coronavirus, reporting a 6.5 percent drop in first-quarter sales, outperforming larger luxury rivals that have reported declines closer to the 15 percent range. Analysts at Bain &Co. have modeled three scenarios for the luxury sector this year, with their intermediate scenario suggesting a contraction of between 22 percent and 25 percent.
The luxury firm is maintaining its gradual expansion of production sites in France, executives said Friday, noting new workshops are set to open in the Gironde and Seine-et-Marne regions in France this year, and two others in the following years. The company counts 43 production sites in the country, which account for nearly half of the company’s employees.
Shareholders approved the three-year renewal of mandates for supervisory board members Dorothée Altmayer, Monique Cohen, Renaud Momméja and Éric de Seynes.