PARIS, France — Louis Vuitton owner LVMH on Wednesday set a high bar for rival luxury goods companies trying to capitalise on Chinese demand for high-end handbags and clothing, with stronger-than-expected sales growth in the first quarter.
The conglomerate, which owns other labels such as Christian Dior in fashion or Krug in champagne, was boosted by a strong performance in its leather goods unit in particular, while sales of spirits like cognac improved from a quarter earlier.
Its performance bodes well for other companies which derive much of their profit from high-margin handbags, and which have proved a hit with consumers in recent years, like Kering's Gucci or Birkin bag maker Hermès.
The group, which cited a "buoyant environment" at the started of the year, posted revenue of €12.5 billion ($14.1 billion) in the period, up 16 percent as reported.
They rose 11 percent on a like-for-like basis, which strips out currency swings and the impact of acquisitions or disposals, beating analyst forecasts and marking an acceleration from the 9 percent growth notched up a quarter earlier.
The company did not break out its performance by region, with more details due during a conference call on Thursday.
But it had previously flagged enduring demand in China at the start of 2019, a key market for luxury brands now trying to increasingly court Chinese consumers on their home turf.
Sales at LVMH's leather goods unit, which is largely driven by Vuitton, rose 15 percent, beating the roughly 11 to 12 percent growth expected by analysts.
By Sarah White and Pascale Denis; editor: David Evans.