LVMH Report Sales Fell 1% In First Half

Louis Vuitton Men's Spring 2017 Collection
Louis Vuitton men's spring '17 collection on the runway at Paris Men's Fashion Week.
Giovanni Giannoni/Fairchild.

PARIS — LVMH Moët Hennessy Louis Vuitton reported Tuesday that sales of fashion and leather goods fell 1 percent in the first half.

Releasing results after the close of trading on the Paris Bourse, LVMH said sales at the linchpin division — where flagship brand Louis Vuitton contributes an estimated 50 percent of group profits — came to 5.89 billion euros, or $6.57 billion, in the first six months of 2016. Sales were stable in organic terms.

The luxury conglomerate published the results the day after revealing that it was selling Donna Karan International to G-III Apparel group for $650 million. The transaction is expected to close in late 2016 or early 2017.

Group sales rose 2.2 percent in the three months ended June 30 to 8.57 billion euros, or $9.67 billion. In organic terms, the gain stood at 4 percent. Dollar figures are converted from euros at average exchange rates for the period.

The increase in organic sales compared with a rise of 3.6 percent in the first quarter of 2016 and a rise of 9 percent in the second quarter of 2015.

In the first half of the year, profit from continuing operations was flat at 2.95 billion euros, or $3.30 billion. Net profit increased 8 percent to 1.71 billion euros, or $7.12 billion, LVMH said.

“LVMH’s results for the first half of 2016 reflect, more than ever, the strength of our business model, which allows us to continue to grow even during an unstable geopolitical environment and economic and monetary uncertainties,” Bernard Arnault, chairman and chief executive officer of LVMH, said.

“The diversity of our businesses, the entrepreneurial style of our brands and the agility of our organization all contribute to the growth of the group. By remaining vigilant, we face the second half of the year with confidence and count on the quality of our products and the talent of our teams to further strengthen our leadership in the world of high quality products in 2016,” he added.

Hermès International last week reported a 6.2 percent rise in second-quarter revenues, while Burberry reported earlier this month that retail sales in its fiscal first quarter, ended June 30, were flat on an underlying basis and 4 percent higher than the corresponding three-month period last year.

Kering is scheduled to publish its quarterly revenues on July 28.