LVMH says "bling" is out but biz trends on mend
By Astrid Wendlandt
PARIS (Reuters) - LVMH boss Bernard Arnault said 'bling, bling' was out, but business was improving for the French luxury group, particularly in spirits, champagne and watches.
The Paris-based luxury giant, which makes Louis Vuitton bags and Hennessy cognac, said on Thursday it had produced record revenue in December and several of its divisions' lieutenants gave a relatively upbeat trading update.
LVMH defied the luxury industry's worst slump in two decades with a 1 percent rise in like-for-like sales in the fourth quarter and a smaller-than-expected drop in operating profit for 2009.
Arnault said the crisis had led consumers to look for authentic and genuine luxury more than ever, a trend which analysts say tends to benefit strong and well established brands.
"With the crisis, 'bling, bling' is largely passe ... and something which someone should not show off," Arnault said.
Christophe Navarre, head of LVMH's wines and spirits unit, said champagne and particularly prestige vintages, had suffered greatly last year but trends improved in January.
"Stocks are at their optimal level," Navarre said about the group's wines and spirits. "January was good, February will be good, so we will have a good first quarter."
Philippe Pascal, head of LVMH's watches and jewelry division, said orders for the new collections of Hublot and Tag Heuer watches, two of its biggest brands, were higher than expected in January. Continued...