LVMH wine & spirits hit by supply issues
LVMH has organic revenues grow 12% in the first nine months of 2017, with double-digit growth for all business groups except Wines and Spirits, which was "limited by supply constraints".
Wines and Spirits achieved revenues of €3.5 billion, an organic increase of 8%, compared with Fashion and Leather Goods (14%), Perfumes and Cosmetics (14%) and Watches and Jewellery (13%).
“Champagne volumes were up 4%, with particularly strong demand in Europe and Japan,” the company states.
“Hennessy Cognac has been performing well since the beginning of the year. The volume increase was 9% for the first nine months of 2017, despite a third quarter decline related to supply constraints. Higher qualities progressed well.”
Weather issues in France, including spring frosts, have affected cognac production. LVMH has flagged that this will mean supply issues will continue for the group.
LVMH said the wine and spirits division saw sales in the three months to the end of September slip slightly, by 0.4%. The performance compares to a 13% rise in sales in the first quarter and a 10% increase in Q2.