© Reuters. His LVMH logo seen before the press conference announcing his 2022 financial results for his LVMH Moët Hennessy Louis Vuitton in Paris, France, January 26, 2023. REUTERS/Gonzalo Fuentes
PARIS (Reuters) – LVMH shares fell on Friday after hitting a high earlier this month.
The French luxury group said late Thursday that fourth-quarter sales rose 9% as shoppers in Europe and the US splurged during the critical holiday season, partially offsetting COVID-19 disruptions in China. reported that it did.
However, some analysts noted its flat margins.
Credit Suisse analysts said, “There was a slight wrinkle in margins and the Group delivered a flat year-on-year operating margin (+90bps for consensus), largely due to hampered earnings growth. Nonetheless, it reflects maintaining/increasing marketing spend in the second half of the year.” wrote in a notebook.
LVMH’s chief financial officer, Jean-Jacques Guiony, said on Thursday that the company had decided to maintain its marketing investments for the second half of the year despite a slowdown in revenue growth in December.
Guiony also said LVMH’s strategy of parallel channels for its perfume and cosmetics divisions was a “costly decision” that would reduce profitability, but that it was the “right decision” and would protect the label’s appeal. .
The division’s profit from recurring operations was €660 million for the year, down 3%.