00:00LVMH ADRs have dropped after organic sales in the company's fashion and leather.
00:05The goods division fell 3% over the holiday season.
00:08Let's bring in Blue Moose.
00:08Caroline Conin for more.
00:10Caroline, why have LVMH sales been struggling?
00:15There is a tough comparison basis which explains some of the declines in the.
00:20Fourth quarter but clearly if you look at the key unit of the fashion and leather which.
00:25Represents about three quarters of operating income at LVMH which includes.
00:30Of course and Christian Dior the organic sales are down 3% in the fourth quarter.
00:35And that is slightly below expectations remember in the third quarter there was.
00:40Actually a rebound at LVMH after two quarters of declines we thought.
00:45Perhaps the end of somehow of this luxury slump maybe not.
00:50Quite yet especially in China demand is still quite muted in.
00:55China organic revenues in that region excluding Japan.
01:00is up just 1% in the fourth quarter even though Bernard Arnault the founder of LVMH.
01:05said last night that this new massive Shanghai.
01:10store called the Louis in the shape of a cruise has been so far.
01:15great success however the wines and spirits division especially.
01:20is very much struggling minus 9% in Q4.
01:25much bigger drop than the 1% we had anticipated we had a story on Cognac.
01:30yesterday saying that demand of Cognac is struggling they are up.
01:35recruiting vines they are cutting jobs and cutting bonuses.
01:40because of course you had these pets with China on territory.
01:45but also you have generally a slowing conception of.
01:50alcohol and that's also impacting these wines and spirits division.
01:54some analysts even say.
01:55saying that maybe at some point that division could be spurned off.
02:00in terms of outlook for 2026.
02:01but now I don't know again saying that 2026.
02:05is not going to be a very straightforward year.
02:08It's very hard for him.
02:10To give predictions in the short term, even though he also said he remains optimistic.
02:15For the midterm.
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