For the quarter ended Sept. 30, LVMH said total net sales rose 1.7%% to 7.02 billion euros (about $9.48 billion), missing analysts’ average estimate for 7.3 billion euros.
Even more surprising, sales at its fashion and leathergoods division, which includes Louis Vuitton, Christian Dior, Givenchy etc., posted a 3.8% decline.
Although sales were up 2.6% in its wine and spirits division and up 13% in its select retailing division, fashion and leather goods, perfume and cosmetics, and watches and jewelry saw slowed sales. “Despite the uncertain economic environment in Europe, LVMH remains confident for 2013,” said LVMH in a statement. “The group will continue its proactive strategy centered on innovation and targeted geographic expansion in the most promising markets.”
Louis Vuitton Leathergoods ‘Very Successful’
For the nine months through the end of September, the fashion and leathergoods division had organic sales growth of 4%. That was down from the 5% increase in the luxury conglomerate’s first half and behind analysts’ estimate for a 6% increase. It also continues a slowdown seen earlier: in April, LVMH reported organic growth of 3% in first quarter fashion and leather goods sales, its weakest performance since the fourth quarter of 2009.
“Louis Vuitton continues to implement its strategy of very high product quality and distribution excellence,” LVMH stated. “The latest creations in leathergoods have been very successful. Fendi continued to focus on fur and leathergoods and its third quarter was marked by the opening of stores in Paris and Milan. Céline showed excellent momentum, supported by its leathergoods and shoe lines. Other brands continued their development.”
Marc Jacobs, Louis Vuitton’s creative director for the past 16 years, will depart in 2014 to pursue his namesake business. No replacement has been announced but some sources report that Nicolas Ghesquière, former designer at Balenciaga, is a likely choice.
In its jewelry and watch group, LVMH said organic sales growth was 3% for the first nine months of the year.
“The performance of LVMH in both watches and jewelry remains excellent in its own stores. Among other initiatives in the third quarter, Bulgari successfully launched the new high jewelry line Diva and TAG Heuer’s new movement manufacturing facility started its operations,” LVMH said. “All brands continued to expand their store networks around the world, helping to strengthen the quality of distribution.”