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The quarterly figures compare favorably to those for the nine months, when group sales fell 8 percent to $9.56 billion. Dollar figures are converted from the euro at current exchange. In local currency, LVMH reported sales of 8.17 billion euros in the period. Stripping out the impact of currency fluctuation, organic growth was 3 percent in the nine months.
“We are very optimistic for the last quarter, even if our growth in the period last year was 13 percent,” Patrick Houel, LVMH’s chief financial officer, said during a conference call with analysts Tuesday.
“Tourism levels have continued to improve in October and there appear to be signs of a sustained economic recovery in the U.S. and Japan,” LVMH said in a statement. “The group expects this momentum to continue in the fourth quarter.”
The results were above the expectations of analysts, who were encouraged by the fact that organic sales growth stood at 6 percent in September, accelerating from 5 percent in July and August. Morgan Stanley analyst Claire Kent noted “there were positive surprises in all divisions other than fragrance and cosmetics and selective distribution.”
Louis Vuitton, which contributes about 65 percent of group profits, remained the engine of the group, with third-quarter organic sales up by double digits in every region of the world except France, where a dearth of tourists in Paris slammed sales at the usually bustling Champs-Elysées flagship.
Houel told analysts he based his optimism for Vuitton on the fact that tourism is rebounding and production capacity has increased for hot products like watches and multicolor monogram bags. He also noted that the yen is gaining strength and Vuitton has expanded its store network versus a year ago.
Kent also noted that Vuitton should have a positive reception to its spring 2004 line unveiled on the runway in Paris on Sunday. It featured many new variations on its signature monogram leather goods in honor of the firm’s 150th birthday next year.