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French luxury conglomerate Louis Vuitton Moët Hennessy (LVMH) has recorded strong second-quarter sales in Asia and Europe, outweighing struggles in the US market.
LVMH oversees more than 75 brands – including Tiffany & Co – and is currently the 13th largest company in the world by market capitalisation.
The company reported total sales of €21.2 billion ($AU34.55 billion) in the three months to the end of June. On a year-by-year comparison, sales from the jewellery division increased by 14 per cent.
Total revenue for the first half of 2023 was €42.2 billion ($AU68.78 billion) an increase of 17 per cent compared with the previous year.
LVMH CEO Bernard Arnault said these results were pleasing in the face of a difficult global economy.
“LVMH achieved outstanding results during a six-month period of ongoing economic and geopolitical uncertainty,” he said.
“The strong creative momentum and excellent distribution of our maisons [brands] continued to inspire dreams, as demonstrated by the enthusiastic reception given to Pharrell Williams’ first fashion show for Louis Vuitton as well as the reopening of the New York ‘Landmark’ of Tiffany & Co.”
Asia – excluding Japan – posted a 34 per cent increase compared with the previous year, when sales were heavily impacted by pandemic restrictions.
Revenue in the US increased by just three per cent, paling in comparison to the 24 per cent rise seen in the same period in 2022.
“Thanks to the desirability of our brands, we approach the second half of the year with confidence and optimism but will remain vigilant within the current environment and count on the agility and talent of our teams to further strengthen our global leadership position in luxury goods in 2023,” Arnault added.
Remaining cautious
LVMH’s figures somewhat reflect those of rival Richemont – recently reporting that strong sales in Asia outweighed declines in the US.
LVMH finance chief Jean-Jacques Guiony told The Financial Times he was ‘very satisfied’ with the retail rebound in China, which makes up the bulk of sales in Asia.
“Last year, the group was pulled up by the United States because China was slowing down. And this year, the US is slowing down, yes, but we are drawn by Asia. This geographical balance is absolutely fundamental,” he said.
“It’s in Asia, it’s still in Korea, in Japan that Chinese consumers are travelling, not in Europe and the US. Today, they still have trouble getting visas.”
Addressing the US slowdown, Guiony said there was pressure on sales in US ‘second-tier’ cities where sales have been particularly strong in recent years.
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