Luxury Shares Soar in Europe as LVMH Sales Rebound -- Update
By Stacy Meichtry
PARIS -- Shares across Europe's luxury-goods sector hit record
highs Wednesday after LVMH Moët Hennessy Louis Vuitton SE reported
a strong rebound in first-quarter sales, defying the pandemic's
drag on the global economy.
Shoppers in China and the U.S., where a rapid vaccine rollout
has led to eased restrictions, are fueling strong demand for
leather goods at Louis Vuitton, Dior and other brands owned by
LVMH. Sales at LVMH reached 14 billion euros, equivalent to $16.75
billion, over the first three months of 2021, a 30% increase
compared with a year earlier, stripping out the effect of currency
changes and its acquisition of U.S. jeweler Tiffany. The
first-quarter sales were 8% higher than the same period in 2019,
before the pandemic.
Shares in LVMH and its closest rivals in the luxury industry
rose to all-time highs on Wednesday. LVMH shares increased 3.2% to
EUR614, Gucci parent Kering SA rose 2.7% to EUR644 and Cartier
owner Compagnie Financière Richemont SA jumped 3% to 96.68 Swiss
LVMH's market value rose above EUR300 billion this week for the
first time, solidifying its status as Europe's most valuable
company, ahead of consumer-goods giant Nestle SA and pharmaceutical
company Roche Holdings AG, as well as the continent's oil giants
As the pandemic gripped Europe last year, a freeze in
international travel fueled investors' concerns that the luxury
sector was heading for dire straits. LVMH and other luxury
behemoths have long relied on tourist traffic in fashion capitals
around the world to drive their sales. Chinese shoppers that once
arrived by the busload vanished from boutiques in Paris and Milan.
Since then, Europe's sluggish vaccine rollout has resulted in the
return of lockdown restrictions in France, Italy and other parts of
LVMH, however, has largely managed to shrug off the pandemic's
impact in Europe due to its expansion in China and the U.S. In
recent years, the luxury giant has worked hard to expand its
e-commerce operations and open new stores in China and beyond,
making it less dependent on Europe.
LVMH said its first-quarter sales in Asia, excluding Japan,
increased 86% compared with the same period last year and 26%
compared with the first quarter of 2019. In the U.S., sales rose
23% compared with the first quarter of 2020 and 15% compared with
the first three months of 2019.
Write to Stacy Meichtry at firstname.lastname@example.org
(END) Dow Jones Newswires
April 14, 2021 08:10 ET (12:10 GMT)
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