Feb 2, 2012
LVMH profit beats forecasts, sees 'excellent' 2012
Feb 2, 2012
PARIS - LVMH, the world's biggest luxury group, posted a forecast-beating 22 percent rise in 2011 operating profit, helped by rapid growth in Asia and at its Louis Vuitton brand, and said the outlook for this year was "excellent".
The owner of the Kenzo fashion brands, Moet & Chandon champagne and Chaumet jewellery said on Thursday that profit from recurring operations reached 5.26 billion euros ($6.93 billion) on sales up 16 percent at 23.66 billion.
LVMH was expected to post profit from recurring operations of 5.1 billion euros on revenue of 23.3 billion, according to Thomson Reuters I/B/E/S.
The luxury industry has been on tenterhooks in recent months over worries that Europe's long-running debt crisis could trigger an economic slowdown in emerging markets like China, where runaway demand for high-end goods has offset weaker trends in the US and Europe.
Swiss luxury goods group Richemont said last month that sales growth held up in the last three months of 2011 - underpinned by buoyant Asian demand and Chinese tourists flocking to European boutiques - allowing it to confirm its fiscal full-year profit goal.
British luxury brand Burberry reported a sharp slowdown in U.S. sales growth in its fiscal third quarter, though it too said that demand from Asian shoppers and tourists remained strong.
Executives at the Geneva watch fair last month suggested that strong demand from Asia was unlikely to make up for weakness in the U.S. and Europe, with growth seen slowing from the record level achieved last year.
LVMH, which took the luxury world by surprise in late 2010 by announcing it had built a stake in Hermes, said in December its holding had risen to 22.3 percent though it repeated it did not want to buy the maker of Kelly handbags and silk scarves.
Hermes family shareholders have responded by creating a majority holding to shield it from the threat of a takeover. ($1 = 0.7592 euros) (Reporting by James Regan; Editing by Leila Abboud)
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