Blog: Luxury growth accelerates at Kering and LVMH
Katie Smith | 29 July 2013
Luxury goods powerhouse LVMH Moët Hennessy Louis Vuitton and Kering, owner of upmarket brands Gucci, Bottega Veneta and Yves Saint Laurent, both reported accelerated sales growth last week, thanks to higher demand in Europe and Asia.
During the first half, growth picked up at LVMH's fashion and leather goods division, which saw sales rise 1% to EUR4.66bn (US$) from EUR4.71bn in the same period last year. This contrasts with the much slower year-on-year sales growth of 0.4% during the first quarter.
The group, which remains confident in its outlook, said its 6% total revenue growth was driven by good momentum in the US and Asia, and continued gains in Europe in a more difficult economic environment.
Meanwhile Kering, which was formerly known as PPR, said luxury sales reached EUR3.08bn during the six months to 30 June, up 5.3% on EUR2.92bn last year, while comparable revenue rose 7.9%.
Kering said revenue generated outside the eurozone rose 6.3% year-on-year in the first half and accounted for 79% of the group total, compared to 78% in the prior year. Sales in France represented 5.4% of the company's total revenue in the first half.
Chairman and CEO François-Henri Pinault said the "robust growth" in the second quarter was powered by a "solid performance" in its directly operated stores and mature markets.
Despite the growth in luxury, both companies reported declines in half-year profit as LVMH reported a 6% drop, while Kering saw profits plummet 64%.
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