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LVMH spirits sales drop in Q1

The spirits segment of LVMH saw revenue fall by 5% in the first quarter of 2023 as Hennessy Cognac struggled in China and the US.

Hennessy is the world’s biggest Cognac brand

For the first three months of 2023, LVMH’s wine and spirits arm, Moët Hennessy, saw revenue rise by 3% to €1.69 billion (US$1.86bn). It followed double-digit growth for the business in 2022.

Wine and spirits sales were driven by the Champagne business, which increased by 14% to €796 million (US$877m).

The spirits segment fell to €899m (US$991m), down from €932m, as Hennessy volumes fell due to the ‘softer’ US market and high inventory levels. The company said the brand showed ‘resilience against the economic environment’ in the States.

Demand for Cognac in China is also in gradual recovery from the impact of the pandemic, LVMH said.

The group also noted ‘solid momentum’ for Belvedere vodka and single malt brand Glenmorangie.

Wine and spirits was the only division of LVMH to not record double-digit growth in the first quarter. The group’s other subsidiaries include fashion and leather goods, perfume and cosmetics, watches and jewellery, and selective retailing.

The company’s total sales increased by 17% organically to €21bn (US$23bn) for the first quarter.

LVMH said: “In an uncertain geopolitical and economic context, LVMH remains both vigilant and confident at the start of the year.

“The group will continue to pursue its strategy focused on the development of its brands, driven by a sustained policy of innovation and investment as well as by a constant quest for quality in its products, their desirability and their distribution.”

During the three-month period, Hennessy collaborated with fashioned designer Kim Jones on a collectible pair of trainers, a decanter and a limited edition XO bottle.

In February, Hennessy Cognac revealed a new global campaign for its Paradis expression, created in partnership with singer-songwriter Alicia Keys.

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