Shares in LVMH on back foot despite sales spark

(Sharecast News) - Shares in LVMH lost their shine on Tuesday, after second-quarter numbers from the French luxury house underwhelmed.

Sales at its core fashion and leather goods division - which is home to a number of leading brands, including Christian Dior, Givenchy and Marc Jacobs as well as Louis Vuitton - rose 1% in the second quarter on an organic basis to �8.9bn. It was the unit's first quarterly increase for two years. LVMH said a "rapid acceleration" in the US had supported trading during the quarter, helping to offset the impact of conflict in the Middle East.

Jonathan Anderson's first designs for Christian Dior had further supported the performance, LVMH added.

However, analysts had been hoping for a rise closer to 1.7%.

Over the six-month period, fashion and leather goods sales fell 1% on an organic basis to �19.1bn. Group revenues were 2% higher on the same basis, at �39.8bn. Net profits were largely flat at �5.7bn.

As at 1230 BST, the Paris-listed stock had shed 2%.

Chief executive Bernard Arnault said: "LVMH demonstrated its solidity and effective strategy. While continuing to pay very close attention to the margins, we are entering the second half of the year with renewed confidence in the long-term potential of our maisons."

The billionaire Arnault family owns around 50% of LVMH. The company, which also owns jewellery and drinks brands, including Tiffany & Co and Dom Perignon, is the first of a number of luxury brands due to publish numbers this week, including Kering after the bell on Tuesday and Hermes on Wednesday.

Over the weekend, Arnault joined X to share a letter he had sent to Le Monde, disputing reports that the family was fighting for control of the empire. "To all those who...are betting on the fracture of a family to sell newsprint. They'll be waiting a long time," he said. Arnault's five children all hold senior roles in the business.