LVMH's Sales Rise, Aided by Perfumes

French luxury giant LVMH Moë t Hennessy Louis Vuitton SE saw its nine-month revenue rise 4% compared with the same period last year, boosted by its Asian market and perfumes business, even as its core fashion unit flagged.

LVMH, a bellwether for the industry and the first European luxury player to release its earnings this season, said Monday that revenue totaled €26.3 billion ($29.3 billion) in the first nine months of the year.

The conglomerate's fashion and luxury-goods division—which includes Celine, Christian Dior and Marc Jacobs and is LVMH's largest unit—grew only 1% in the period to €9.0 billion. Its wines and spirits business, including Moet & Chandon, posted 5% revenue growth to €3.3 billion.

Perfumes and cosmetics were the strongest division in the period, growing 6% on the year, the company said. Louis Vuitton, the luxury giant's flagship brand, launched a new perfume.

Sales in Asia, excluding Japan, showed a significant improvement during the third quarter, the company said. It added that the wines and spirits division showed a strengthening result in China during the first nine months of the year.

LVMH doesn't report quarterly profit figures. As a result, investors will have to await full-year results to see what impact the slowdown has had on profitability, given that many luxury-goods companies are sinking more money into their retail networks and digital channels to combat an industry slowdown.

While LVMH said that sales growth picked up over the course of this year, the company is growing far more slowly than in recent years. During the first nine months of 2015, its sales grew 18% compared with the same period in 2014.

LVMH's slowdown reflects a shift in the global luxury market. Weakening luxury-goods sales in China, whose shoppers represent one third of the luxury market, according to advisory firm EY, changes in customers' tastes and volatile currency and macroeconomic conditions have erased the double-digit growth rates many luxury goods houses enjoyed until recently.

LVMH's sales growth began to slow in 2013, prompting it to refresh key brands such as Louis Vuitton, the conglomerate's profit and sales powerhouse. Other brands such as Kering and Prada have also seen similar slowdowns.

LVMH gave a positive outlook Monday for its U.S. and European markets, with the exception of France, which continues to suffer a decline in tourism after recent terror attacks. It also said the company will pursue "targeted geographic expansion" in certain market.

Write to Manuela Mesco at [e-mail]

(END) Dow Jones Newswires

October 10, 2016 15:25 ET (19:25 GMT)

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