Arnault warns that the days of ‘bling bling’ are largely over.
Parisian luxury giant LVMH has posted a 1 percent rise in like for like sales in the fourth quarter of 2009.
The company’s president, Bernard Arnault, announced the modest growth in a relatively upbeat trading update, but cautioned that the days of conspicuous consumption on luxury goods could be over for some time.
"With the crisis, ‘bling, bling’ is largely passe … and something which someone should not show off," Arnault said.
Analysts suggest that LVMH brands, such as TAG Heuer, Zenith, De Beers and Chaumet, could thrive in the coming year as consumers look for lasting value from established brands.
Philippe Pascal, head of LVMH’s watches and jewellery division, said orders for the new collections of Hublot and Tag Heuer watches, two of its biggest brands, were higher than expected in January.
"We had an encouraging January," Pascal said.
LVMH’s profit from recurring operations reached 3.35 billion euros in 2009, down 8 percent from 3.63 billion in 2008.
The group’s revenue fell 2.4 percent to 5.11 billion euros in the fourth quarter against the same period last year. Over the year, revenue fell 4 percent on a like-for-like basis.
Total net profit for 2009 reached 1.76 billion euros.