LVMH’s sales growth in the third quarter eased from the previous quarter, when purchases of Louis Vuitton bags and other luxury items surged when stores reopened after COVID-19 lockdowns.
Organic revenue at the fashion and leather goods unit rose 24 percent in the third quarter from a year earlier, the company said in a statement on Tuesday.
In the second quarter, sales in that key division had more than doubled from a year earlier, when stores were mostly shut during the first wave of COVID-19.
LVMH said that it is confident the current growth would continue.
The French company is one of the first luxury groups to report this quarter and its results suggest that the industry’s growth remains on track as the pandemic eases its grip, even if the pace slows.
In addition, the company does not expect China’s “common prosperity” policy to be detrimental to the upper-middle class that forms the bulk of its customer base in China, LVMH chief financial officer Jean-Jacques Guiony told analysts during a call, adding that it could be even be positive for sales.
“We’re not particularly worried,” Guiony said.
Asia, excluding Japan, was LVMH’s biggest region at the end of last month, accounting for 36 percent of sales. The US ranked second, contributing one-quarter of revenue.
LVMH’s sales breakdown showed the fashion and leather division grew 38 percent on a two-year basis in the third quarter after growing 40 percent in the previous quarter.
Third-quarter organic revenue growth came in at 18 percent at the watches and jewelry unit.
Sales at the unit — which has included Tiffany since January — were “soft” in Asia in August amid disease prevention measures, but improved last month, Guiony said.
However, momentum for Tiffany was “particularly strong” in the US, LVMH financial communications director Chris Hollis said during the call.
Overall, LVMH’s sales of 44.2 billion euros (US$51.1 billion) in the first nine months of the year have surpassed 2019 levels.
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