Shares in LVMH home to labels such as Christian Dior and Louis Vuitton, climbed towards record highs on Tuesday, after the world's biggest luxury goods company reported stronger-than-forecast revenue growth for the third quarter. Kate King reports.
Seasons are as important to Fashion, as they are to Finance. And it seems the world's biggest luxury goods company is nailing both. LVMH shares climbed towards record highs on Tuesday, after reporting stronger-than-forecast revenue growth for the third quarter. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER SAYING: "A big element of that of course is the strength of LVMH itself in terms of its wide diversity with brands ranging of course from Christian Dior, to Louis Vuitton and Moet and Chandon." Shares were up as much as 2.4% in early trade. The growth largely driven by a revival in Chinese appetite for luxury goods - following a drop off in 2016. Perfumes and cosmetic sales led the way - gaining 17 percent. But LVMH's key Fashion and Leather goods division - which accounts for about 50 percent of sales, also put its best foot forward. Posting organic revenue growth of 13 percent. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER SAYING: "Cracking third quarter figures revenues, like-for-like revenues are up about 12 percent. To some extent it shouldn't be surprising in as much as we are currently seeing a synchronized global economic recovery. So you would therefore expect high spending particularly in luxury goods." The groups spirits unit was the only one to miss analyst's forecasts of around 6 percent, due to supply constraints. The only other negative, the growing value of the euro. A luxury reserved for those spending them - not counting them with LVMH reporting a negative currency impact of 5 percent.