LVMH Earnings Surge as Leather Goods Sales Accelerate

PARIS, France — LVMH Moet Hennessy Louis Vuitton SE reported an estimate-beating 15 percent increase in first-half earnings as sales of fashion and leather-goods accelerated and the wines- and-spirits division returned to growth.

Profit from recurring operations rose to 2.96 billion euros ($3.3 billion), the world’s largest luxury-goods maker said in a statement after European markets closed Tuesday. Analysts predicted 2.93 billion euros, according to the average of 11 estimates compiled by Bloomberg.

LVMH recorded strong growth in Europe and the U.S., while Louis Vuitton had an excellent start to the year, the Paris-based company said. "We face the second half of the year with confidence," said Chairman Bernard Arnault.

Rivals Burberry Group Plc and Kering SA recently reported sales that were boosted by a rise in the number of Chinese tourists shopping in Europe. The focal point of the luxury market has been gradually shifting westward since late 2012, when China began discouraging extravagant spending among government officials.

Revenue at LVMH reached 16.7 billion euros in the first half, up 19 percent from a year earlier, or 6 percent on an organic basis, the company said.

Organic sales at the unit that includes Vuitton handbags and Givenchy dresses rose 5 percent in the half, compared with a 1 percent gain in the first quarter. Six-month wines and spirits sales rose 2 percent, rebounding from a 1 percent drop, as U.S. demand for Hennessy cognac compensated for weakness in China.

By Andrew Roberts; editors: Matthew Boyle, Paul Jarvis, Kim McLaughlin.