Luxe Continues Climbing

Who cares about tapas and sangria when you’ve got caviar and champagne? Despite the uncertainty surrounding economies in Spain, Greece, Italy and Portugual, sales of luxury goods continue to gain momentum for LVMH, a leader in the lux space.

In a recent conference call with analysts, LVMH chief financial officer Jean-Jacques Guiony said its marketing and product pipeline would be stronger in the second half, with polka-dot Vuitton leather goods, Berluti fashions and lady Link watches from Tag Heuer coming on stream.

And he cited “no change at all in the global trend” in China, were the raw growth number stood at about 15% across the first and second quarters.

Dramatic price differentials between Asia and Europe continue to drive luxury sales on the continent. Guiony noted that up to 55% of luxury goods bought by Chinese nationals are purchased while abroad.

François-Henri Pinault, chairman and ceo of PPR, called the group’s first-half performance “highly satisfactory” and was bullish looking ahead.

“We are confident that we will be able to continue growing our revenues in the second half of 2012 and that our full-year financial performance will outstrip that of 2011,” he said.

LVMH’s Q2 sales rose 26.5% to 6.38 billion euros, or $8.2 billion. Sales at LVMH had jumped 25.4 percent in the first quarter.

The company noted that sales in the half grew 9% in perfume and cosmetics, 10% in fashion and leather goods, 13% in watches and jewelry, 15% in wines and spirits and 16% in selective retailing.

Meanwhile, over at L’Oréal, the world’s largest beauty company, Q2 sales rose 11.6% to 5.57 billion euros, or $7.16 billion at average exchange, driven by its business in North America and new markets. Sales in those regions were up 22.7% and 14.4%, respectively. On the strength of those results, L’Oréal execs reiterated their intent to outperform the overall cosmetics market in 2012 and achieve another year of sales and profit growth.

During the first half, L’Oréal posted sales of 11.21 billion euros, or $14.55 billion, a 10.5% gain. In comparable terms, they climbed 6%.