UPDATE 2 -Hermes said prices will increase as posts profit growth

  H1 operating profit of EUR 584.1 million

* Reinforces targets sales growth margin ( future Adds CEO comments , stock )

30th August ( Reuters) - Hermes plans to raise its prices next year , partly in response to the rising cost of silk and leather , the French luxury group said Friday it is written forecast beat the odds of the first half.

Hermes, the manufacturer from 6000 to 30,000 euros ($ 8,000 - $ 40,000 ) Birkin and Kelly bags , hiking the prices after increases from rivals such as Louis Vuitton LVMH and Gucci earlier this year Kering .

Like his colleagues , said Hermes , and the fight against the rising cost of materials , the movement sought to fluctuations in currencies such as the yen against the euro even lower .

Japan accounts for nearly one-fifth of sales for Hermes, the largest in the country on a European manufacturer of luxury risk , dealers such as UBS was .


"You can in fact expect price increases, which , as always, we want to be moderate ," said Axel Dumas , Patrick Thomas will take over as CEO of the company, if the decision of retire next year . Dumas did not give details .

Hermes shares were nearly 3 percent higher at € 255.55 by 1219 GMT , the second biggest winner on the French SBF 120 index in general.

Hermes grew to 14 percent of operating profit in the first half to € 584.1 million ( $ 772 million ) , thanks to strong demand for its leather accessories and silk, so the group a margin of 33 percent 1 .

According to Thomson Reuters I / B / E / S , Hermes was expected a profit of € 570 million to write .

Hermes on Friday confirmed the operating margin in 2013 would be close to the 2012 record of 32.1 percent.

calfskin

The company said it increased sales and profits thanks to higher volumes, which decided not to prices at the beginning of this year reached hike.

"This is a very decent set of results , the management is very encouraging," a Paris-based trader said . "We should not massively revise our numbers, but some tuning to fully understand the direction. "

Last month, Hermes reported a forecast beating 16 percent increase in sales in the second quarter at constant exchange rates due to strong demand for its leather accessories and silk , marking an improvement compared to an increase of 12 8 per cent in the first quarter .

At that time he said he was getting closer to the operating margin reached record levels last year , according to the prediction of a decline.

It provides that the revenue growth for the full year would easily surpass slightly increase the medium-term growth target of 10 percent and an operating income faster than incomes .

Hermes reiterated its revenue forecast on Friday and added that the net cash amounted to € 596 million at the end of June .

Last month, LVMH and leaders Kering growth industry , but emphasized the weakness of China.

Hermes is facing a dwindling supply of calf leather - the commodities No.1 - because the supply of meat traders who react to a drop in demand for meat and livestock and is thus driven slaughter fewer animals .

Meanwhile, the demand for luxury leather goods is still growing and forcing hides up to 20-30 percent per year , the price of quality. ($ 1 = € 0.7562 ) (Reporting by Gilles Guillaume , James Regan and Astrid Wendlandt , additional reporting by Blaise Robinson , edited by Pravin Char)