PARIS – LVMH Moët Hennessy Louis Vuitton said it was “cautiously confident” for 2021 after sales trends continued to improve in the fourth quarter, fueled by the strong performance of its key fashion and leather goods division.
The segment saw revenues increase 18 percent on a like-for-like basis during the period. Organic sales at its star brands, Louis Vuitton and Dior, grew in the double-digits in the last two quarters, and profitability at Vuitton remains “exceptional,” the luxury conglomerate reported on Tuesday.
Group sales were down 3 percent in organic terms in the three months to Dec. 31, versus a fall of 7 percent in the third quarter, and a rise of 8 percent during the same period last year, just before the coronavirus pandemic halted travel and forced thousands of stores to close.
While Asia saw double-digit growth in the second half, the United States and Japan are gradually recovering, but Europe continues to struggle, LVMH said in a statement published after the market close.
After posting several consecutive years of record results, it saw net profit fall 34 percent in 2020 to 4.7 billion euros, while operating profit was down 28 percent to 8.3 billion euros. Sales were down 17 percent in 2020 to 44.6 billion euros, underscoring luxury’s relative resilience, helped by a sharp increase in online sales.
Excluding fashion and leather goods, all other categories saw revenues decline in the fourth quarter.
Wines and spirits fell 11 percent; perfumes and cosmetics were down 15 percent, and watches and jewelry lost 2 percent. Selective distribution — which includes Sephora and DFS, LVMH’s travel-retail business — saw revenues dive 26 percent as international travel showed no sign of recovery.
LVMH earlier this month completed its acquisition of U.S. jeweler Tiffany & Co., strengthening its foothold in the lucrative fine jewelry market.
Source: Read Full Article