LVMH Reports 7% Rise in Q3 Sales

LVMH - Moet Hennessy Louis Vuitton, the world’s largest luxury products group, reported a 7 percent rise in sales to 8.754 billion euros ($10.8 billion) in the first nine months of the year, boosted by a tourism-driven rebound in the high-end retail sector.

 

The firm also reaffirmed a forecast for "significant" operating profit growth this year.

The watches and jewelry unit and the fashion and leather goods division both posted a six percent rise in sales to 355 million euros ($438.3 million) and 3.105 billion euros ($3.83 billion) respectively.

On an underlying basis that strips out swings in currencies and the effects of acquisitions and divestments, turnover rose 13 percent over the nine-month period, and 10 percent in the third quarter.

Analysts had forecast a slowdown in underlying growth in third-quarter, following rapid growth of 14 percent in the first half of this year as the basis for comparison with the same period last year was tough.

Last year LVMH's first-half performance was damaged by the war in Iraq and the SARS virus in Asia, but sales picked up in the third quarter.

"Tourism levels have continued gradually to improve in October and economic growth in the United States and Asia continues," LVMH said. "The group expects this momentum to extend through the fourth quarter," it added, allowing it to confirm its aim for a "significant increase in operating income in 2004".

In its watches and jewelry division, LVMH said TAG Heuer “delivered a very strong performance in the U.S. and in Asia, as did Zenith. The watch Chiffre Rouge developed by Hedi Slimane for Christian Dior enjoyed an excellent reception.”

Meanwhile, in the fashion & leather goods business, “Louis Vuitton continued its double-digit organic sales growth in the third quarter. Also noteworthy were the strong performances delivered by Celine, Loewe and Marc Jacobs.”