Sales of Louis Vuitton handbags and the easing of lockdowns across the world helped revenue soar at fashion house LVMH.
In a stellar quarter for the owner of some of the world’s best-known luxury brands, like-for-like sales rose 84% in the three months through June, ahead of analyst expectations.
Much of the gain was fueled by demand for fashion and leather goods, particularly at Louis Vuitton, Christian Dior, Fendi, Loewe and Celine, the company announced in a statement. Organic revenue in this division jumped 120% in the second quarter from a year earlier and 40% from the same period in 2019. LVMH benefited from an easy comparison with 2020 as many stores remained shut last year due to the pandemic.
This is the “strongest first-half update ever” for LVMH and will probably prompt earnings upgrades for a company seen as the bellwether of the luxury goods industry, Luca Solca, an analyst at Sanford C. Bernstein, said in a note to clients.
LVMH was active in the period, presenting a so-called cruise collection from Christian Dior at an Athens event attended by celebrities such as Catherine Deneuve and “The Queen’s Gambit” star Anya Taylor-Joy. It also launched a new sparkling wine aperitif and reopened La Samaritaine, a department store located on the right bank of Paris that had been shut for more than 15 years.
Profit from recurring operations came in at 7.63 billion euros ($9.02 billion) in the first half. Analysts had expected 6.62 billion euros.
Looking ahead, Dior is preparing to reopen its store at 30 Avenue Montaigne in Paris in the second half, LVMH’s director of financial communications, Chris Hollis, said during a call with analysts. Hollis also said Tiffany is set to launch a new collection of gold jewelry after an “excellent” first half, with a “momentum particularly strong” in Asia and the U.S.
--Bloomberg News
