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Champagne and Cognac sales hit LVMH profits
The wines and spirits division of Moët Hennessy Louis Vuitton suffered a 28% drop in profits in 2009.
The luxury goods giant blamed the slump on excessive destocking by distributors as the financial crisis impacted consumer demand for high-end Champagnes and Cognac’s.
Total sales of wines and spirits fell by 14% on a like-for-like basis for the 12 months to the end of December, down to €2.74 billion compared to €3.1bn in 2008.
The company, which owns the Glenmorangie whisky, Hennessy Cognac and Moët & Chandon Champagne brands, said profits from recurring operations in the wine & spirits division fell by 28% to €760m.
The results would have been even worse had sales not improved significantly in the fourth quarter.
LVMH said: “Hennessy, which demonstrated good resilience in 2009, registered growth in the fourth quarter due to strong renewed momentum in the United States and in China.”
Alan Lodge, 05.02.2010