LVMH shares jump after posting 10% rise in fourth-quarter sales

Paris — LVMH shares jumped as much as 9% in early Friday trade, boosting peers including Kering and Hermes, as the French luxury giant’s latest sales figures reassured investors about the sector’s ability to cope with economic headwinds.

LVMH posted a 10% rise in fourth-quarter sales on Thursday, driven by resilient demand — including from Chinese buyers — for its high-end fashion over the end-of-year trading period.

Investors had grown skittish about the industry’s prospects after LVMH’s previous report in October which showed its sales growth slowed to 9% after a long spell of routinely outpacing expectations with strong double-digit growth.

At a results presentation on Thursday, LVMH chairman and CEO Bernard Arnault said he was happy with the company’s current growth rate.

With its latest report, LVMH “reassured — and coped nicely with a sharp slowdown in sales momentum” in the second half, Jefferies analyst James Grzinic wrote in a note to clients, adding the report should “steady nerves in the near term”.

As the sector comes down from the high paced growth seen after the pandemic, the diverging fortunes of brands has come into view, with those catering to wealthier clients, such as Hermes, better equipped for economic challenges than those pursuing turnarounds, like Burberry, which issued a profit warning earlier this month.

But shares of Burberry also traded higher on Friday, up 1.8%.

LVMH was top gainer on the eurozone blue-chip Stoxx 50E index.

Reuters