Monday, 31 August 2009

Mixed Results For Hermes And Tiffany & Co. – 31/8/09

Recent news has continued to slightly confuse our take on the luxury market and their respective results as we hear them, although we are mindful we are reviewing Tiffany & Co.'s quarter and Hermes first half year. How we seem to have moved past the dire financial announcements of six months ago and are now moving towards more positive sentiments and cautious optimism.

At the moment, we have Tiffany & Co. where "Revenue shrank 16 percent to $612.5 million in the three months ended July 31, beating the $600.7 million average analysts’ estimate in a Bloomberg survey. Tiffany raised its annual profit forecast". According to a Bloomberg article, cost cutting is being sighted as the main reason for the better than predicted performance. Analysts are now predicting sales will decline 10 percent versus 11 percent previously. One point is very important at this end of town…

Meanwhile, on the other side of the coin we have Hermes, who announced a 7 percent drop in profits for their first half year results. This was a worse than expected figure and they have "blamed the drop on currency fluctuations and a lower rate of return on financial investments," according to
a New York Times article. Despite this setback, manufacturing of their covetable silk scarves and Birkin bags will still continue with gusto.
Article by: Melinda O'Rourke

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Who's behind the MO DOWN

Melinda O’Rourke is the founder and Director of MO Luxury, a dynamic, Sydney-based management firm specialising in luxury brands and services. Melinda and her associates at MO work with local and international brands across prestige retail, fashion, fine jewellery, timepieces and specialised services. Melinda is well-connected, well-read, and well-versed in the demands of the luxury market and its client base. Her advice is firmly based in objectivity and ultimately, accountability. Melinda offers constructive counsel and both strategic and creative thinking and is able to draw upon a strong network of specialised talent to compliment the MO Luxury team as needed. Melinda enjoys excellent industry relationships and is regularly quoted in the business and fashion media. Read more about MO Luxury,