The high-end discretionary luxury sectors provided mixed results. The only surprise was Porsche AG: The luxury carmaker reports an 18.3% return on sales with operating profit up 9% to €5.5 billion – this occurs on higher input costs and some provisions for the four product launches next year. The company indicates that it expects resilient high-end consumption even amid high inflation and an uncertain global economy.
Kering: The French luxury group reports a bigger-than-expected drop in third quarter sales, underperforming major rivals as its top brand Gucci and other fashion labels all suffered from a slowing appetite for high-end clothes and accessories. Sales at YSL, Balenciaga, and Bottega Veneta came in 9% lower (assume fix FX rates). The consensus view was for 6% decline.
LVMH: the other key providers of high-end products, the world’s biggest luxury group, and one of Europe’s biggest companies by market value, also reports a slowdown in third-quarter sales. However, compared to other luxury companies, LMH clocked an increase in revenues. The main driver of the positive results were sales at its leather goods division which were up by 9%. In the same manner, Birkin sales of bags (Hermes) reports a rise in sales of 15.6%.