An employee walks out of an elevator inside a Hermes showroom in Mumbai (Reuters)
French luxury goods-maker Hermès International posted a sharp rise in first-half profit as global sales rose above expectations in the opening six months of the year.
Paris-based Hermès, known for its Birkin and Kelly bags, reported a net profit rise of 13.9% to €381.7m ($506.9m, 326.7m) in the six months to 30 June.
Profit from its recurring operations rose as much as 14.3% to €584.1m, while sales climbed about 11% to €1.7bn.
Sales in the Americas region lifted 17% during the period, while France saw sales growth of 13%, the rest of Europe 14%, non-Japan Asia 17%, and Japan 8%.
"Demand for Hermès products remains strong," said the company, but admitted its bag sales "remains constrained by production capacity".
Hermès said total sales could "slightly exceed" the growth target of 10% for the full-year after a solid first-half performance.
The firm reported an operating margin of 33.1%, an improvement of one point due to the "positive impact of foreign exchange hedgings".
It added that it is getting close to touching the previous year's record margin level.
Hermès employs around 10,600 staff across the world after creating 486 new jobs in the first quarter of the year, boosting sales and strengthening its production capacities.
Hennessy Louis Vuitton, the world's largest luxury goods maker, raised its stake in Hermès to 23.1% during the first half, from 22.6%.
Meanwhile, Hermes and Da Milano's leather goods retailing unit in India were reportedly involved in a legal conflict.
The company received a ban order from New Delhi High Court to stop Da Milano from trading handbags that it claimed were identical in shape and design with the popular Hermes' Birkin bags.
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