LVMH wine and spirits sales grow 10% in Q1

Luxury goods conglomerate Moët Hennessy Louis Vuitton (LVMH), whose brands include Moët & Chandon, Dom Perignon and Krug, has reported a strong start to the financial year with organic sales increasing by 13% in Q1 and its wine and spirits brands achieving a 10% uplift.

Overall, LVMH reported revenue of €10.9 billion for the first quarter 2018, an increase of 10%, with organic growth increasing by 13%, compared to the same period in 2017.

All sectors of its business reported positive growth, however reported sales of wine and spirits fell flat, which nevertheless equated to organic growth of 10% based on fluctuating exchange rates.

Champagne volumes rose by 1% over last year, the group said, which, driven by its main markets and prestige cuvées, represented the fastest growth for wines over the period.

In January, LVMH announced in its full year results for 2017, stating that its wine and spirits arm had witnessed a surge in growth last year thanks to the US and recovery in China.

In total the group recorded revenue of €42.6 billion in 2017, an increase of 13% over 2016, with reported revenue from the wine and spirits category growing 5% between 2016 and 2017 from €4.8bn to over €5bn.

The performance of the wine and spirit brands across all markets was described as “good” but it was the only part of LVMH that did not enjoy double digit growth in 2017, which the group put down to “supply constraints” in the second half of the year.

In the first quarter of this financial year, LVMH reported that Hennessy Cognac had seen its volumes increase by 5%, with China and the United States posting growth in line with the trends seen in the second half of 2017.

“In the buoyant environment of the beginning of this year, albeit marked by unfavorable exchange rates and geopolitical uncertainties, LVMH will continue to focus its efforts on developing its brands, maintaining strict control over costs and targeting its investments on the quality, excellence and innovation of its products and their distribution,” a release said.

“The Group will rely on the talent and motivation of its teams, the diversification of its businesses and the geographical balance of its revenue to reinforce, once again in 2018, its global leadership position in luxury goods.”