The French luxury giant Louis Vuitton Moet Hennessy (Lvmh), despite the geopolitical context in the first nine months of the year it contained losses with 60,7 billion in turnover down 2%. The golden age of exceptional growth recorded in the post-Covid era is over, the biggest problem today for the group led by Bernard Arnault, is the slowing down of the China struggling with the cooling of consumption. Instead Europe and the United States recorded a slight growth at constant perimeter and exchange rates and the Japan continued to post double-digit revenue growth although in the third quarter, the decline was mainly driven by the strengthening of the yen. For Bloomberg It was the worst quarter since the second quarter of 2020.
The results effect is contagious this morning Kering (-2% after losing more than 5% at the start), Dior (-5,6%), L'Oreal (-4%), Hermes (-3%) in Paris, Richemont (-2,7% in Zurich) and in Milan Moncler (-3,2%), e cucinelli (-2,3%).
Iconic brands down 5% and wines down 11%
In 5% decrease in the quarter the division Fashion & leather goods, which includes the iconic brands of Louis Vuitton, Dior, Fendi, Loewe, Pucci and Loro Piana and posted revenues of €9,15 billion. This was significantly lower than the +1% expected. In the nine months, the decline was 3% to €29,9 billion. Louis Vuitton and Christian Dior both enjoyed great visibility over the summer with the Paris 2024 Olympic and Paralympic Games.
Still weak in the nine months Wines & Spirits Division, in double-digit decline to 4,19 billion euros (-11%). Demand for champagne is decreasing. The Hennessy cognac was held back by weak local demand in the Chinese market, while the United States saw a return to growth in the second quarter, in a market that remains cautious. Among Provençal rosé wines, Château d'Esclans stepped up its international expansion and a strategic partnership was signed with French bloom, a premium alcohol-free sparkling wine label co-founded by French top model Constance Jablonsky. The division also Watches, with brands such as Tiffany & Co. and Bulgari, showed a decrease of 5% to 7,53 billion euros.
Only the perfume and cosmetics sector continues to grow at +2%
The sector that shows the greatest resilience is that of Perfumes & Cosmetics which brought back a del% increase 2 to 6,14 billion euros with fragrances and make-up and skincare products from Christian Dior who achieved an “excellent” performance. Guerlain and Givenchy have recorded solid growth in perfumery. The Selective retailing category, driven by the chain, also Sephora, which continued to gain market share in North America, Europe and the Middle East, posted revenues of $12,5 billion (+1%).
Lvmh, focus on Italy
Despite the uncertain global picture, "the group is confident and will maintain a strategy focused on improvement and innovation of the appeal of its brands, drawing on the authenticity and quality of its products, excellence in distribution and agile organization,” LVMH wrote in a statement. In addition, the group will also strengthen its presence in Italy, where the company, which already includes six fashion houses (Acqua di Parma, Bulgari, Cova, Fendi, Loro Piana and Pucci) and 35 manufacturing plants in Italy, invests 200 million euros a year. Among the latest operations is also the recent entry into Double R, the holding company that controls Moncler, in addition to its presence and that of the L Catterton fund in the capital of Tod's, which allowed the Della Valle family to announce the delisting. Among the objectives announced for 2023 is the hiring of over 2 artisans in Italy by 2025.
