LVMH revenues increased by 9% to €19.96bn in Q3 2023, following a boost in prestige fragrance sales.
The earnings are down when compared with the luxury goods conglomerate’s stellar half-year performance, which saw revenues rise 15% to €42.2bn.
This was the result of a 4% negative exchange rate impact, despite the Fenty Beauty owner reporting double-digit organic growth in Europe, Japan and Asia.
LVMH’s Perfumes & Cosmetics division helped bolster its performance during the quarter, with organic revenue growth up 12%.
Christian Dior in particular saw significant growth, with Miss Dior, J’adore and Francis Kurkdjian’s latest creation, L’Or de J’adore, benefiting from strong sales.
Dior Addict and Prestige also contributed to the business’ earnings during the quarter across both its make-up and skin care categories respectively.
Benefit Cosmetics, meanwhile, experienced an uplift from its newly launched Fan Fest mascara and consistent sales from its Pore Care range.
Despite fragrance’s strong performance during Q3, CFO Jean-Jacques Guiony did note an overall slowdown in the growth of its Dior brand specifically.
“The brand has tripled in size in less than seven years, so [even though] I wish it would be the case, it cannot go on like that forever,” said Guiony.
“You cannot grow a business 30% per annum forever, the business has to consolidate as we cannot open in that many stores - otherwise we will end up over distributing the brand.
LVMH acquired Benefit Cosmetics in 1999
Looking forward to 2024, Guiony also referred to the potential impact on earnings due to LVMH’s price increases this year.
He continued: “There will be a limited impact from pricing, despite the fact that we have passed on price increases in most markets.”
The US market was left largely untouched, for example, but the business did implement price hikes in both China and Europe and more significantly in Japan.
“There will be some elements of pricing seen next year, but in a limited way, and we do not expect that to be the basis for growth in 2024,” Guiony added.
The brand owner is ultimately confident of its growth going into Q4 and the new year, and said it will maintain its strategy of continuously increasing awareness of its brands.
“LVMH will draw on its powerful brands and the talent of its teams to further strengthen its global leadership in the luxury goods market in 2023,” LVMH said in a statement.
