PARIS — Luxury behemoth LVMH Moët Hennessy Louis Vuitton powered through the third quarter, with sales advancing 4.9 percent to 3.08 billion euros, or $3.76 billion.

Excluding the impact of currency exchange, organic growth stood at 10 percent, headlined by double-digit gains at cash cow Louis Vuitton and a continued rebound at its selective retail and watch and jewelry divisions.

The results were in line with analysts’ expectations and underscore a strong run for luxury firms this year, despite tough comps leading into the critical holiday selling period.

Citing a gradual improvement in tourism in October and robust economies in the U.S. and Asia, LVMH said it “expects this momentum to extend through the fourth quarter.” It also reiterated its objective of a “significant” increase in operating income for 2004.

“We are very optimistic for the rest of the year and in our businesses for the year to come,” chief financial officer Jean-Jacques Guiony stressed during a conference call on Thursday.

Pressed by analysts for more information on Louis Vuitton’s performance and prospects, Guiony cited flat sales for the brand in Japan, and acknowledged that sales were slowing in the U.S.

“We don’t expect Vuitton to [continue growing] at 50 percent a year,” Guiony said, referring to figures in recent quarters in the U.S. However, he emphasized that sales of Vuitton to Japanese clients were still growing at double-digit levels, reflecting more sales outside of Japan, and that prospects in the U.S. remain promising. He described sales of Vuitton in the U.S. as growing at “very, very strong” double digits.

“There are no signs on the market that consumption patterns are changing,” Guiony said. “The market is still very strong and reacting strongly to all the novelties.”

LVMH cited particularly strong demand for Vuitton’s trompe l’oeil bags, which feature its famous monogram printed on jacquard velvet.

In a research note, HSBC luxury analyst Antoine Belge said market fears about the group’s leading brands are unfounded.

“Even if management does not want to commit itself to a target, we believe there is fairly high visibility on [Vuitton] achieving at least 10 percent organic sales in 2005,” he wrote.

This story first appeared in the October 15, 2004 issue of WWD. Subscribe Today.

He also noted that 15 to 20 percent growth in the U.S. is achievable since “growth in the U.S. is mostly coming from new client bases whose purchasing power vulnerability to rising interest rates should be lower than average.”

By division, sales in the quarter ended Sept. 30 increased 4.6 percent to 1.08 billion euros, or $1.32 billion, for fashion and leather goods; 12.1 percent to 813 million euros, or $994.2 million, for selective retail; 3.6 percent for perfumes and cosmetics to 524 million euros, or $640.8 million, and 1.5 percent for wines and spirits to 558 million euros, or $682.4 million. Sales of watches and jewelry slipped 4 percent to 120 million euros, or $146.7 million. Dollar figures are at the average exchange rate.

Besides Vuitton, LVMH cited “the strong performance delivered by Celine, Loewe and Marc Jacobs.”

Sales of Fendi were down “significantly” in the third quarter as the Italian brand sought to reduce discounted sales, LVMH said. It added that the transfer of some revenues to licensees also took a chunk out of sales for Donna Karan.

In perfumes and cosmetics, the Christian Dior and Guerlain brands drove sales in the division, LVMH said, citing “excellent” debuts of Pure Poison by Dior and the men’s version of L’Instant by Guerlain.

For the nine months, group sales advanced 7 percent to 8.75 billion euros, or $10.85 billion. In organic terms, growth stood at 13 percent.

In reported terms for the nine months, selective retailing advanced 13 percent to 2.36 billion euros, or $2.92 billion; wines and spirits 9 percent to 1.47 billion euros, or $1.82 billion; fashion and leather goods 6 percent to 3.11 billion euros, or $3.85 billion; watches and jewelry 6 percent to 355 million euros, or $440.2 million, and perfumes and cosmetics 1 percent to 1.5 billion euros, or $1.85 billion.

LVMH officials had no comment when asked if the company was bidding for Scottish whisky firm Glenmorangie, as some press reports have speculated.

Shares of LVMH slipped 1.6 percent Thursday to close at 55 euros, or $68.16 at the current exchange rate, on the Paris Bourse.

Also on Thursday, LVMH sister company Christian Dior Couture reported sales of 158 million euros, or $195.9 million, for the third quarter, an increase of 12.1 percent. At constant exchange, the increase was 15 percent.

“And the trend at retail continues to be good,” Dior president Sidney Toledano told WWD. “For October, we continue to be above 20 percent at retail.”

Toledano said men’s wear, shoes and handbags were standout categories in the quarter, with Japan, Asia overall and the U.S. the strongest regions.

Looking ahead to the balance of the year, Toledano said new products, including a special jacket collection by John Galliano, would drive sales, along with store openings. Next week, Dior christens a new seven-level boutique in Tokyo’s burgeoning Ginza district.