LVMH sees slower luxury sales in third quarter
French luxury conglomerate LVMH said it remains confident for 2013 despite releasing Tuesday sales figures showing a dip in sales for its fashion, watches and perfumes businesses.
Overall sales for the group which owns Louis Vuitton, Givenchy, Guerlain and many other luxury brands rose by 1.74 per cent in the third quarter to 7.02 billion euros (S$11.8 billion, US$9.47 billion), which missed analyst expectations for growth of around 4 per cent, and was a slowdown from the 5.7 per cent growth registered in the second quarter.
Sales for the first nine months of the year rose by 4 per cent to 20.7 billion euros, considerably less than the 22 per cent growth registered in the same period last year.
However sales in LVMH's key Fashion and Leather Goods unit slid by 3.8 per cent to 2.43 billion euros in the third quarter and were down by 1 per cent for the nine months.
Sales in the Watches and Jewellery unit dipped 1.9 per cent and declined by 2.1 per cent in the Perfumes and Cosmetics segment in the third quarter compared to the same period last year.
Sales in the Wines and Spirits and Selective Retailing segments improved.
LVMH said in a statement that it "remains confident for 2013... despite the uncertain economic environment."
The group posted a net profit of 1.58 billion euros in the first half of the year.
Changing political environment
Sales of high-end jewelry, watches and handbags have been slowing lately, some five years after the world’s luxury goods makers embraced wealthy Chinese consumers as important drivers for global business growth.
The Chinese luxury market for a long time underwent abnormal growth supported by tax policies and gift consumption. But recent anti-corruption measures and a subsequent (sales) slowdown will help the market return to a normal development pace.
French luxury conglomerate LVMH said it remains confident for 2013 despite releasing Tuesday sales figures showing a dip in sales for its fashion, watches and perfumes businesses.
Overall sales for the group which owns Louis Vuitton, Givenchy, Guerlain and many other luxury brands rose by 1.74 per cent in the third quarter to 7.02 billion euros (S$11.8 billion, US$9.47 billion), which missed analyst expectations for growth of around 4 per cent, and was a slowdown from the 5.7 per cent growth registered in the second quarter.
Sales for the first nine months of the year rose by 4 per cent to 20.7 billion euros, considerably less than the 22 per cent growth registered in the same period last year.
However sales in LVMH's key Fashion and Leather Goods unit slid by 3.8 per cent to 2.43 billion euros in the third quarter and were down by 1 per cent for the nine months.
Sales in the Watches and Jewellery unit dipped 1.9 per cent and declined by 2.1 per cent in the Perfumes and Cosmetics segment in the third quarter compared to the same period last year.
Sales in the Wines and Spirits and Selective Retailing segments improved.
LVMH said in a statement that it "remains confident for 2013... despite the uncertain economic environment."
The group posted a net profit of 1.58 billion euros in the first half of the year.
Changing political environment
Sales of high-end jewelry, watches and handbags have been slowing lately, some five years after the world’s luxury goods makers embraced wealthy Chinese consumers as important drivers for global business growth.
The Chinese luxury market for a long time underwent abnormal growth supported by tax policies and gift consumption. But recent anti-corruption measures and a subsequent (sales) slowdown will help the market return to a normal development pace.
