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LVMH has reported organic revenue growth of 13 per cent in the first three months of 2017 but the world’s largest luxury group by revenues warned that this rate of performance should not be extrapolated for the full year.
Organic revenues grew 13 per cent to €9.9bn during the first quarter, LVMH said on Monday after the market close. It “benefited from a favourable comparison base, particularly in Europe, where activity was affected last year by the impact of the November 2015 attacks in Paris.” This means that growth may be slower in the rest of the year.
All of the group’s five main divisions posted double-digit organic returns, led by fashion and leather goods (+15 per cent), and wine and spirits (+13 per cent). Perfume and cosmetics, where LVMH recently announced an acquisition of perfumer Maison Francis Kurkdjian, grew 12 per cent. Meanwhile, organic revenues in the selective retailing and watches and jewellery divisions were each up 11 per cent.
LVMH has a diversified portfolio of 70 brands, among them Louis Vuitton, TAG Heuer watches and Hennessy cognac.
The results come after a year in which the luxury sector as a whole returned to growth, and LVMH reported record revenues of €37.6bn and operating profit of €7bn in 2016. The sector has bounced back from a slowdown in China and terrorism in European cities that has hurt tourism, a key driver of luxury spending.
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