UPDATE 2-LVMH Q1 sales beat forecast, sees spending rebound

* LVMH Q1 sales 4.472 bln euros vs consensus 4.207 bln euros

* Q1 sales up 13 pct like-for-like, 11 pct reported

* Says saw a strong rebound in U.S. and Europe.

* Shares up 3.25 pct, near 10-year high, leads CAC40

(Adds details, analyst quote, background, shares)

By Astrid Wendlandt, European Luxury Goods Correspondent

PARIS, April 13 (BestGrowthStock) – LVMH (LVMH.PA: ), the world’s
biggest luxury group, posted a forecast-beating 13 percent rise
in comparable sales for the first quarter, helped by a strong
rebound in the U.S. and Europe.

The upbeat news from the Paris-based maker of Louis Vuitton
handbags and Hennessy cognac, helped cement the view that
discretionary spending was firmly on the mend after suffering
its worst slump in two decades.

LVMH said its wines, spirits, watches and jewellery
businesses, all hit hard by the downturn, had benefited from an
improvement in consumer spending and demand from distributors
replenishing their stocks.

Shares in LVMH, the first major European luxury group to
post first-quarter figures, jumped to 92.36 euros in high volume
trade, their highest point since September 2000, and by 0722 GMT
were still up 3.25 percent at 91.62 euros, the top French
blue-chip gainer.

The rest of the luxury sector followed in its slipstream.
Shares in PPR (PRTP.PA: ), which owns Gucci Group, were up 1.63
percent, and shares in Richemont (CFR.VX: ) were up 1 percent.

LVMH generated revenue of 4.472 billion euros in the three
months to March 31, beating a forecast of 4.207 billion euros in
a Reuters poll.

“It is much better than expected, across the board,” said
Dennis Weber, analyst at Evolution Securities.

The group’s 13 percent like-for-like growth compared with
expectations of 6-7 percent, analysts said.

“There seems to be a perfect alignment of stars for LVMH at
the moment,” HSBC said in a note.

On a reported basis, sales were up 11 percent.


First-quarter sales at its wines and spirits unit, which
makes Moet & Chandon and Ruinart champagne and Glenmorangie
whisky, rose 20 percent on a comparable basis to 635 million

Meanwhile, LVMH’s watches and jewellery business, whose
brands include Tag Heuer and Chaumet, reported like-for-like
growth of 34 percent to 204 million euros.

Philippe Pascal, the head of the unit, forecast at the Basel
jewellery and watch fair last month that first-quarter sales
would be up by more than 20 percent, driven mostly by retailers
rebuilding their stocks.

LVMH’s trading statement comes a week after the French group
announced plans to expand in the luxury hotels business,
starting with two projects in the Middle East in partnership
with Orascom Holdings (ODHN.S: ).

LVMH shares have underperformed the bull run in the luxury
sector. Though they have gained 70 percent in the past year,
other luxury stocks such as Richemont and Swatch (UHR.VX: ) have
more than doubled.

LVMH shares are valued at 20 times this year’s earnings, at
the top end of the European luxury goods sector average of 18-20
times, leading many brokers to see the stock as fairly valued.


(Additional reporting by Blaise Robinson and Juliette Rouillon,
Editing by Will Waterman)

UPDATE 2-LVMH Q1 sales beat forecast, sees spending rebound