Peppered later with questions about Fendi, which on Monday named Michael Burke, formerly second in command at Christian Dior, as its new chief executive, Houel made it clear that LVMH plans to continue to invest in the Rome-based house. He said profitability is several years away.
In the nine months, all divisions saw sales fall in reported terms, with watches and jewelry and selective retailing also registering organic sales declines.
Fashion and leather goods revenues slipped 3 percent to $3.43 billion, or 2.93 billion euros. Sales of perfumes and cosmetics dropped 9 percent to $1.73 billion.
At LVMH’s selective retail division, sales slipped 12 percent to $2.43 billion. However, the company cited a “gradual recovery in tourism levels” and said the duty-free chain was on track to break even for the full year.
By geographic region, LVMH said that organic sales in the U.S., excepting Hawaii, were up 6 percent in the first nine months. Houel noted that Vuitton sales were up 29 percent in the region, versus 5 percent for fashion and leather goods.
Asked about the discrepancy in sales performance, Houel said the shutdown of underperforming Donna Karan boutiques and outlets was largely to blame.
In Japan, sales were up 14 percent in local currency in the nine months, with Vuitton sales advancing 18 percent.
French companies report sales and earnings separately. LVMH’s net profits jumped 23.8 percent to $297 million in the first half, versus $239.8 million a year ago, as reported.
On Monday, LVMH said it maintains its objective of “tangible growth” in operating income for the full year, but declined to elaborate. Merrill Lynch is forecasting an 8.1 percent increase in EBIT — earnings before interest and taxes — to $2.54 billion, or 2.17 billion euros, for 2003.
Shares in LVMH slipped 0.4 percent to close at $67.74 on the Paris Bourse.
A vigorous U.S. market and three store openings boosted Burberry Group plc’s revenues 17 percent in the first half ended Sept. 30, the company said in a statement, to $531.6 million from $454.3 million. Burberry’s figures have been converted from the pound at current exchange. Reported revenues were 320.2 million pounds versus 273.7 million pounds in the year-ago half.