Hermes and Burberry’s financial results for Q3 of 2015 have beaten analysts’ expectations.
The figures come at a challenging time for luxury brands in the key Asia-Pacific region, including China.
Hermes sales rose by 7.9% in Q3 on a like-for-like basis, ahead of forecasts, helped by demand for leather goods and ready-to-wear fashion.
Meanwhile, Burberry reported a better-than-expected 3% rise in first-half underlying profit.
The maker of trench coats and cashmere scarves said it made a pre-tax profit of £153 million ($233 million) in the six months to September 30.
Burberry also said its comparable store sales improved in its third quarter compared with the second.
Meanwhile, Hermes stuck to its target of increasing annual sales by 8% at constant exchange rates.
It said that in the quarter Japan had delivered 16.6% like-for-like growth, and Europe 14.8%.
However, Asia-Pacific growth, excluding Japan, dwindled to 1.5% amid “a difficult context in Hong Kong, Macao and to a lesser extent in continental China”.
In October, Burberry had also warned of an increasingly challenging environment for luxury goods in China and Hong Kong.
Last month, LVMH, the world’s biggest luxury group, said the summer stock market collapse in China had hit sales, particularly at its flagship Louis Vuitton brand.
Cosmetics giant L’Oreal has also warned that demand for its luxury products has suffered a slowdown in Hong Kong and at airports.
Burberry investors have voted against the company boss’s pay package at the annual general meeting in London.
52% of shareholders voted not to support Christopher Bailey’s pay package, in a rare stand against large salaries.
Christopher Bailey, who took over as chief executive in May, has a package worth up to £10 million ($16 million) a year.
Burberry admitted it was “a lot of money”, but said the amount was justified, to keep him in the business.
The company said the vote was “disappointing”.
Burberry investors have voted against the company boss’s pay package
However, it is not binding, so the company will not be forced to change its policy.
Christopher Bailey, who was appointed chief executive in May, has an annual allowance of £440,000 ($705,000) on top of his £1.1 million ($ 1.8 million) salary.
On his appointment, he was also given 500,000 shares in the company, currently worth more than £7 million ($11.2 million).
Investors also expressed concerns about 1.35 million shares he was allocated before becoming chief executive, which had no performance criteria attached to them.
At today’s valuation, these shares would be worth £19.5 million ($31.2 million) when he is eventually allowed to sell them in several years’ time.
In the meantime, Burberry said he could earn more than £10 million ($16 million) a year over the next five years, if the retailer hits its performance targets.
Christopher Bailey retained his position as chief creative officer, when he took over from Angela Ahrendts as chief executive.
Earlier this week Burberry announced healthy sales growth, particularly in China.
Luxury fashion brand Burberry has announced a strong rise in sales but warned that profits could be hit by unfavorable exchange rates.
Retail revenues for Q2 2014 were $592 million, up almost 10% from a year earlier, while like-for-like sales increased by 12%.
Sales were particularly strong in China and Hong Kong.
Burberry has announced a strong rise in sales but warned that profits could be hit by unfavorable exchange rates (photo Wikipedia)
But it warned that if exchange rates remained at current levels, retail and wholesale profit could be cut by $88 million.
Burberry added that, given movements in the sterling-yen exchange rate, it expected licensing revenue to be down by about $16 million.
“The first quarter performance reflects our focus on striving to give customers the best possible experience of the Burberry brand through ongoing investment in retail, digital and service, both on and offline,” said chief executive Christopher Bailey.
“With great brand momentum and a focused vision, we remain confident of delivering sustainable, profitable growth into the future.”
Burberry said it had seen double-digit sales growth in American and Asia Pacific markets. Europe, the Middle East and Africa saw “low single-digit” sales growth.
The retailer also highlighted the strong performance of its online business.
