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Family business roundup: Profits up at Lego, Hermes and Bertelsmann

It’s been an upbeat week for family businesses Lego and Hermes as strong consumer demand for their popular products boosted half-yearly sales and earnings.

It’s been an upbeat week for family businesses Lego and Hermes as strong consumer demand for their popular products boosted half-yearly sales and earnings. Meanwhile, media company Bertelsmann had mixed results for the same period, with healthy net profits but lower operating earnings.

Net profit at Danish toymaker Lego jumped 35% in the first six months of the year to two billion Danish kroner (€268 million) from 1.48 billion Danish kroner during the same period in 2011. Revenues for the first half of the year likewise went up 24% to 9.1 billion Danish kroner.

The company, controlled by the Kirk Kristiansen family, credited the strong gains on the success of Lego Friends. Sales of the new range, which is targeted at girls, were twice as high as expected, the firm said.

“It has been amazing to experience the enthusiastic welcome that consumers have given the new range,” said non-family chief executive Jorgen Vig Knudstorp. “Sales have been quite astonishing.”

The line has been criticised by consumer groups for reinforcing gender stereotypes. It is the company’s attempt to expand the appeal of the famous plastic bricks beyond boys.

Meanwhile, French luxury goods firm Hermes, known for its silk scarves and Birkin bags, reported a 21.9% rise in consolidated sales to €1.6 billion for the first six months of the year. Operating income for the same period increased by 22.2% to €510.9 million from €418.1 million a year ago, driven by strong sales in Asia and Europe. 

On the back of the results, the company, controlled by the eponymous family, said it is raising its annual sales growth target to 12% from its forecast last month of 10%.

German media conglomerate Bertelsmann, controlled by the Mohn family, reported a 5.5% increase to €7.6 billion in half-yearly revenues from continuing operations, compared to €7.2 billion during the same period in 2011. Net profit for the six months ending June 30 rose 31% to €353 million from €269 million a year ago. 

However, operating EBIT from continuing operations for the period slipped 1% to €731 million from €739 million in 2011.

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