LVMH Come Out On Top

Style : It's official; we are spending again. However, whilst this statement may not apply to most people, it seems the well-heeled are as LVMH have announced a surge in its first-quarter sales of 2010.

The group, which takes its name from Louis Vuitton, Moet & Chandon Champagne and Hennessy cognac, said its sales grew to £562 for the devision, with underlying sales, or promised future sales, up 13% taking it to £3.95 billion from £3.5 billion.

City experts reckoned on a 7% increase, but after the 13% was announced they cited its 'excellent' performance in Asia and 'strong rebound' in the US and Europe. But what ever the figures, that is a lot of bags, and a lot of cognac, and it is quite a surprise that the Asian arm of the company is doing well considering the drop in GDP recently.

But it has been a time of investment for buyers as its best performing divisions were watches and jewellery, and wine and spirits which saw like-for-like sales of 34% and 20% respectively. However, it is an indication that consumers are not spending frivolously on accessories such as bags, small leather goods etc but in items that will appreciate with value, such as watches and good quality alcohol.

The demand of restocking by retailers and a big demand for luxury brands under the LVMH umbrella, including Tag Heuer and the divine Chaumet jewellery was indicated by the success of the new products presented at the Switzerland Watch Fair this year in Basel. The fair is the only place for luxury retailers, and not only gives an indication of success, but also progress and technology within the horological community.

Whilst LVMH said the outlook for the recovery of the global economic crisis was uncertain, they did say that Louis Vuitton continues to deliver an exceptional performance, it has seen a growth in its heritage/historic lines but also seen a positive response to its latest, innovative products.

Whilst this is good news for the luxury goods industry, I don't think the majority of the UK public, or Greece as we have learned this week, will be reassured much by this news, and will not be a great indication of the UK's stability based on conspicuous consumption during this election period.

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