Fashion And Leather Goods Are Not Ideal Enough For The Fastest Growing Retail Sector.

< p > a few days ago, the French luxury group LVMH announced its first half of fiscal year 2013, which reported that the group achieved 13 billion 695 million euros in revenue in the first half of the year, an increase of 6% over the same period last year.

However, operating profit increased by 2% to 2 billion 712 million euros from 2 billion 659 million euros last year, less than analysts expected 2 billion 750 million euros, while net profit fell 6% to 1 billion 577 million euros.

< /p >

< p > "there are two reasons for the unsatisfactory net profit: first, opening up new markets requires a lot of investment in the early stage; secondly, although there are some new consumers, some high-end consumers are pulling out of their customer camps."

Zhou Ting, Dean of luxury goods and Research Institute of wealth and quality, admitted that LVMH has great influence on the whole market.

< /p >

< p > Fashion and leather goods are not ideal enough. < /p >

< p > Du Yanhong, a researcher at CIC's retail industry, has seen that this year's development of LVMH's brand continues and presents a relatively good trend. Its performance in Asia, Europe and the Americas is in line with market expectations.

From the sub regional perspective, the market demand in Asia is gradually released, and the performance of the follow-up LVMH will be more contributed by the Asian region. LVMH will continue to increase investment in Asia and adjust the market and performance of different brands.

< /p >

< p > although LVMH said that the market share of all brands in the group has been improved, the US, Japan and Asian businesses continue to grow well, and the difficult economic environment in Europe can also grow. However, the fashion and leather goods department of the flagship brand LV of LVMH is not ideal enough.

< /p >

< p > it is reported that the sales volume of the above departments was 4 billion 711 million euros in the first half of this year, with a growth rate of only 1%.

Jewelry and watches sales fell 3% to 13.10 euros, operating profit of 156 million euros, down 2% compared to the same period last year.

In this regard, LVMH explained that the slowdown was due to the weakening of purchasing power of watch retailers and the closure of some multi brand sales outlets.

< /p >

< p > Du Yanhong said that the growth rate of LVMH jewelry and watch department gradually increased from 20% over the past few years to the current 3%, indicating that the market demand for watch business is gradually shrinking.

< /p >

< p > quality retail sector has the fastest growth rate < /p >

< p > earnings report shows that the fastest growth is still in the retail sector. In the first half of the year, sales increased by 17% to 4 billion 215 million euros, the natural growth rate was 19%, and operating profit increased by 9% to 407 million euros.

The sector's contribution to group total sales has increased from 27.7% in the same period last year and 30.78% in the first quarter of this year to the first half of the year.

In the Department, sales of DFS and duty-free shops are strong.

< /p >

"P >" according to Zhou Ting, SHV and DFS global duty-free shops are the fastest growing in the boutique retail sector, making the base of consumption wider and bigger through overseas heat and easy to walk, making the group very big support.

< /p >

< p > sales of wine and spirits sector increased by 3% to 1 billion 808 million euros, organic growth 5% and operating profit of 542 million euros, up 9% over the same period.

Champagne business is strong in Europe, and Asian market has strong demand for its brand. Sales are flat compared with the same period last year.

< /p >

< p > sales of perfume and cosmetics sector increased by 4% to 1 billion 804 million euros, organic growth 6%, operating profit of 200 million euros, an increase of 2% over the same period last year.

Dior and Guerlain are eye-catching in their perfumes. Dior and Givenchy cosmetics business have made significant progress. Benefit and Fresh international are growing rapidly.

< /p >

< p > Du Yanhong believes that at present, the quality retail sector is the engine of LVMH growth, and its contribution to the overall performance is increasing. Subsequent LVMH will further increase investment in the retail sector, which is also in line with the trend of the market towards quality and high-end retail.

In addition, the perfume and cosmetics market still has great room for growth, especially in the Asia Pacific region, such as China, which is a part of the market and business that LVMH can not ignore.

< /p >