LVMH fashion sales fall 5% as Chinese demand weakens
The luxury group's third-quarter organic sales rose 1% to €18.5 billion, below analysts' expectations, with jewelry and Sephora supporting revenue.
LVMH organic sales growth slows as weaker China demand hits fashion
Third-quarter revenue reached €18.5 billion, but organic sales in the fashion and leather goods division fell 5%, exceeding the decline analysts expected.
LVMH reported €18.5 billion in revenue for the quarter ended September, a 1.2% increase from a year earlier. Organic sales rose 1%, below expectations and slower than the second quarter’s 3% growth, as weaker Chinese demand weighed on its fashion business.
The group said sales growth was good across Japan, Europe and the United States, while conditions in China were less favorable. Its fashion and leather goods division recorded a 5% organic sales decline, compared with the roughly 2% decrease analysts had expected, according to Deutsche Bank. That reversed the division’s previous-quarter return to organic growth, its first in two years.
Other businesses recorded gains. Selective retailing, which includes cosmetics chain Sephora, delivered 8% organic growth. The watches and jewelry division and the wines and spirits business each posted organic increases of 6%.
For the first nine months, LVMH’s sales totaled €57.1 billion, with organic growth of 2%. The measure strips out currency effects and changes in the group’s business portfolio. LVMH said its range of businesses helped it withstand geopolitical and economic uncertainty.
LVMH shares have fallen nearly 40% since the year began. L’Oréal surpassed it in September to become France’s most valuable listed company.