Un informe de ultima hora
LVMH: Not great but not the disaster feared
LVMH reported 9mths Sales up 4% reported and 4% organic to €21,397m broadly in line with expectations. In Q3 14 Sales LVMH Group Sales came in up 6% reported and 4% organic; the 4% organic was actually a tad better than expected. By divisions, Wines & Spirits was the sore point, down an implied 7% organic in Q3 14 on our calculations, offset by stronger organic Sales growth in Perfumes & Cosmetics (+10%) and Watches & Jewellery (+8%). We received a lot of incomings on Fashion & Leather Goods that we calculated up 1% to 2% organic in Q3 vs other analysts calculating 0%. This is big deal to investors, in particular those with a shorter term horizon: 0% is considered a disappointment, 2% good enough in a sea of sequential deceleration in the sector (F&LG in Q2 was 0%). Having looked at all the data we have on hand, we stand by our calculations and lay out in this note why. Ultimately as we sit back from the disproportionate debate as to whether F&LG posted 0% or 2% growth in the quarter, we find this was not a good set of numbers but not the disaster feared. We will await the conf call at 3pm CET on Wednesday to make more educated changes to our estimates but at this stage we anticipate limited impact despite the negative division mix as we are already factoring in significant margin pressure in Cognac in H2.
We stand by our calculations of Fashion & Leather Goods up 1% to 2% organic in Q3 14. We actually think it was most likely closer to 2%. We hear loud and clear that some brokers have calculated 0% and rounding can lead you to one or the other end of that spectrum. Still there are several cross-references that lead us to believe it’s closer to our calculations: 1) F&LG in total reported growth, this in fact was 1% below, unlikely that this was driven by a 3% miss on organic sales growth (consensus at +3%, +1% was the acceptable threshold post the Italian Borsa Luxury conference and Burberry results), 2) the forex impact was a tad better maybe (but note that if it were +2%, you would have had to sell a fair bit to get there in a close to neutral forex environment in Q3 so it is biting its own tail) but Loro Piana’s impact was a tad lower, and 3) LVMH Group organic sales growth was 4% in Q3 (this is given by LVMH), i.e. the rounding has to have been rather favourable by divisions to reach this level and this includes the F&LG division. Management will not doubt be asked at its conf call what was the organic sales growth in Q3 for the division and how LV fared with it. It has more often than not chosen not to answer this question.
Wines & Spirits is a key sore point to investigate. The performance in Q3 was a lot worse than expected, down 7% on our calculations, and appears to have been dragged down by Cognac in China still. Indications of sell in vs sell out and guidance for Q4 and into FY15 will be a key although we doubt LVMH management will commit to much before the critical Chinese New Year event.
Perfumes & Cosmetics and Watches & Jewellery were pleasing accelerations offsetting most of the Cognac weakness and at odds with cautious comments on both categories from other players. Within Watches & Jewellery Bulgari jewellery was a stand out which should have a slight positive read on Richemont.
Selective Retailing up 6% organic was in line with our expectations, a slowdown on H1 14 we would expect driven by HK.
By geography, an improved growth rate in Europe and the US were said to have compensated for the slowdown observed in Asia.
Resultados mas que solidos en un escenario tan adverso (sobre todo en Europa, donde sigue creciendo). Repito que es una empresa con un negocio que me encanta. Un negocio tan simple como que poner una chapita que pone Louis Vutton te supone poder duplicar el margen sobre coste de un producto y que ademas la gente esta encantada de pagarla. Tan nivel de "moat" ni las queridas Coca Colas de Buffet...
el problema es que si China no crece y le explota la burbuja inmobiliaria, tal vez el negocio de LVMH tenga más cuesta arriba el camino de las ventas. Yo estoy dentro del valor desde ayer por una vision meramente especulativa. Espero no pillarme los dedos mucho. Los datos europeos y como se comporten los mercados en un par de dias pueden ser clave
Hola Titanio. A mi la verdad que me apasionan las acciones aburridas...je je je !!!
Por lo que veo con el dividendo, tiene un yield de justo el 2,5%, justo lo mínimo que pido a mis compras simpre y cuando estas sean crecientes año a año y según google finance los últimos años han sido así (si estoy confundido me corriges por favor). Gracias por tu experiencia, pues siempre es enriquecedor para los que estamos con la intención de entrar en un valor nuevo.
Hoy se ha pegado un buen mamporro (-3%). Supongo que algo tendrá que ver el todavía más gran maporro que se ha pegado la bolsa china (el sector "lujo" necesita de una clase media/alta fuerte en los países emergentes para crecer). En fin, mañana saldremos de dudas (hay presentación de resultados trimestrales).