Shares in France's LVMH rose over 5% to record highs in early trading on Tuesday after the Louis Vuitton owner posted better-than-expected sales growth in the first quarter, helped by thriving Chinese appetite for luxury goods.
Organic sales were up 13% in thew quarter, compared to the same period last year, with the group posting sales of €10.9 billion for the period.
The upbeat start to the year for LVMH sets an encouraging tone for peers at the start of their reporting season.
Luxury goods firms benefited from a strong rebound in Asian demand last year, a momentum that has shown little signs of fading.
"Despite the concerns about the toughening comparable basis in the luxury sector, we believe that LVMH's results confirm the ongoing strong underlying trends in the market," analysts at Berenberg said in a note.
Wines & Spirits
The group's Wines & Spirits division, which includes Moët & Chandon and Hennessy cognac, posted an organic sales increase of 10% in the quarter, with the division posting sales of €1.2 billion.
The company said that its Champagne volumes were up 1% on last year, driven by the group's main markets, with its Prestige cuvées growing the fastest over the period.
Hennessy saw volumes up by 5% despite a 'context of supply constraints'.
Wines & Spirits sales in China and the United States posted growth 'in line with the trends seen in the second half of 2017', LVMH said.
'In the buoyant environment of the beginning of this year, albeit marked by unfavorable exchange rates and geopolitical uncertainties, LVMH will continue to focus its efforts on developing its brands, maintaining strict control over costs and targeting its investments on the quality, excellence and innovation of its products and their distribution.'