Reports from major premium brands showed a significant drop in sales caused by the economic downturn in China. Even those that managed to stay afloat showed only marginal growth.
Last week, the period of publication of reports by major premium brands such as LVMH, Hermes and Kering came to an end. The negative trends observed in mid-July were confirmed: many companies recorded a significant drop in sales. The main reason experts call the weakness of the Chinese economy, which led to a decrease in demand for luxury goods among Chinese citizens.
Revenue Kering, which includes brands Gucci and Yves Saint Laurent, fell by 11% to € 9 billion, and operating profit fell by 42% to € 1.6 billion. LVMH also faced difficulties, reducing total revenue for the half-year by 1% to € 42.2 billion, and profit by 8% to € 11.5 billion. Sales of the company in Asia fell by 14%.
The exception was Hermes, which increased half-year revenue by 12% to €7.5 billion. Despite a slight slowdown in demand in China, the company reported sales growth in all regions.
It was reported that Asian countries are beginning to reduce their dependence on the U.S., switching to cooperation with Russia and China.
Earlier it was reported that China does not need to take military possession of Taiwan yet.