LVMH, the prominent French luxury conglomerate, has reported a significant increase in sales in its fashion and leather goods division for the third quarter, which has led to flat shares during early trading on Wednesday.
The success of LVMH’s iconic brands, Louis Vuitton and Dior, has played a crucial role in driving growth in the fashion and leather goods division. This division contributes nearly half of the group’s total sales and has experienced an impressive 24% increase in revenue during the quarter. Notably, the division’s revenues at the end of the quarter were 38% higher than its pre-pandemic level in 2019, maintaining the same growth rate seen in the first half of the year.
Following the opening bell, LVMH shares initially rose by 0.4% before stabilizing during early trading. Despite this, the company’s performance has surpassed that of the broader French stock market, which demonstrates investor confidence in its consistent success.
In a note, analysts at Jefferies expressed optimism and pointed to LVMH’s strong quarter as evidence of its ongoing triumph. However, they also exercised caution regarding the sector in the short term. Nevertheless, they view LVMH as a long-term winner within the luxury industry.
When examining overall sales, excluding the impact of foreign exchange fluctuations, LVMH recorded a 20% rise to 15.51 billion euros ($17.91 billion) in the three months leading up to September. This growth closely aligns with the analyst consensus forecast, which predicted a 21% increase.
LVMH’s ability to maintain robust sales figures and surpass pre-pandemic levels is indicative of the resilience of the luxury market. Despite the ongoing challenges presented by the pandemic, the company continues to leverage the popularity and desirability of its renowned brands to drive growth and deliver favorable financial results.
As the year progresses, LVMH is expected to navigate a changing consumer landscape and adapt to evolving market conditions. With its solid performance and established market position, the company remains well-positioned to thrive within the luxury industry. This is likely to attract investors seeking long-term stability and profitability.
Useful Links:
1. LVMH Official Website
2. Forbes Article on LVMH’s Expansion and Sustainability
