PARIS - French luxury goods giant LVMH fought off a plunge in its shares Wednesday, reassuring that Chinese consumers were still hungry for goods from the key Louis Vuitton part of the business where sales flagged.
The price of shares in the global group was showing a fall of 6.42 per cent to 135.55 euros in an overall French market down 0.76 per cent.
Analysts at Bank of America-Merrill Lynch lowered their investment recommendation for the shares on Wednesday.
At brokers Aurel BGC, analyst David Da Maia said: "The setback for Louis Vuitton in the third quarter is likely to weigh on all luxury company shares."
LVMH also said that currency factors played a role in the performance of sales by the group.
The Louis Vuitton range of products again lagged those of the fashion and leatherware brands.
Louis Vuitton accounts for more than 70.0 per cent of annual sales of the fashion and leatherware division which also includes the brands of Celine, Givenchy, Fendi and Kenzo. Vuitton is the main profit driver of the entire LVMH group.
It turned in sales estimated to total 7.3 billion euros (US$9.9 billion) last year but since then has had difficulty in generating growth.
In the third quarter, internal growth of sales by fashion and leatherware brands, excluding the effect of exchange rates, did not exceed 3.0 per cent, totalling 2.4 billion euros, from an increase of 7.0 per cent in the second quarter.
The finance director of LVMH, Jean-Jacques Guiony, said during a telephone press conference that "growth by Vuitton was slightly below" that of the division as had been the case in the previous quarters this year.