Forecasts lowered for luxury-goods maker LVMH

Bloomberg News

PARIS — LVMH Moet Hennessy Louis Vuitton SA shares fell 5.1 percent as analysts cut profit and sales forecasts on concern a weaker economy is damping demand.

The largest luxury-goods company likely had a first-half sales gain of 8.4 percent, according to a report by a WestLB analyst, Gilles Lequeux. Merrill Lynch analyst Antoine Colonna forecast a 9.5 percent increase in a report released yesterday.

Chairman Bernard Arnault said in March the maker of Givenchy fashions and Dom Perignon aims for growth of 10 percent or more in both sales and profit this year. In May, amid signs of economic weakness, he said that was "an objective, not a promise."

"The U.S. slowdown and the weakening Japanese yen will mean a reduced sales across the luxury-goods industry, but LVMH will be more affected than others," said Eric Girondeau, a KBC companies.

Shares of LVMH, which also owns DFS Group, fell 3 euros to 56 euros. They have lost 35 percent in a year.

ING Barings analyst Florence Hernandez cut her recommendation on LVMH to "hold" from "buy." She wasn't available to comment.

LVMH spokesman Olivier Labesse declined to comment.

The company will report first-half sales later this month