Fashion Wire Daily - Paris - Hermes posted a 10 percent increase in revenue in the third quarter of 2009, as booming leather goods sales and an impressive performance in China powered on the group.

The Paris-based luxury brand said turnover in the third quarter grew by 10.2 percent to 452.1 million euros, or $669 million. However, the house said that taking into account favorable exchange rate movements, turnover for the third quarter grew by only 4.8 percent.

For the first nine months of 2009, total revenue advanced 8.5 percent to 1.327 billion euros, or $1.963 billion, though at constant exchange rates, sales were up 1.4 percent on the first nine months of 2008.

"If the trend seen from the beginning of the year continues, the group's target of steady sales at constant exchange rates over the full year will be slightly exceeded," the house said in a release on Friday, Nov. 6.

In a busy third quarter, Hermes acquired a landmark building in central London, which will become the brand's key flagship in the U.K. Hermes released a one-line press statement when buying the building, merely confirming the acquisition. The French group paid 83 million euros, or $122.8 million, for the London real estate.

In terms of performance by sector, Hermes' leather goods and saddlery division, which includes bags and luggage, horse riding, diaries and small leather goods, boomed, rising 25 percent to 223.5 million euros, or $331 million, in the latest three month period, though silks and textiles sales were flat at 45.5 million euros, or $67.4 million.

However, while its own stores performed strongly, with sales up 19 percent, business in Hermes' jewelry and "art of living" division slid 11.5 percent to 17 million euros, or $25.2 million.

In terms of geographic zone, the Paris-based firm reported a sturdy 12.4 percent rise in turnover in business in North and South America to 72.1 million euros, or $107 million.

But the most spectacular improvement came in Asia, outside of Japan, where sales growth jumped 35 percent, "fueled primarily by robust expansion in China and Korea," Hermes said.

During the first nine months of 2009, Hermes opened nine new branches, including two in the U.S. and two China, as well as inaugurating its first store in Brazil, in Sao Paulo.

During the current fourth quarter, Hermes will open or renovate six branches, including one new store in the U.S., in Seattle, and another in Canada, in Calgary.

Nonetheless, the company remained gloomy in its forecast in the medium term, cautioning in the final line of its release that the "business climate may remain bleak."