By Mimosa Spencer

PARIS, (Reuters) – French luxury brand LVMH will post solid fourth quarter earnings on Thursday. It follows a series of solid earnings by rivals that demonstrated steadfast demand to high-end clothing and accessories among pandemic sufferers.

According to consensus estimates, the sales of luxury brands like Dior and Louis Vuitton will rise 16 percent at constant exchange rate over the holiday period.

UBS Forecasts predicts that the fashion and leather goods segment of the company, which is responsible for half the revenues, will continue to dominate the sector with a market share of 21%. This compares to 16% in the pre-pandemic period.

This division has a profit margin of around 40%. It is one the best in the business.

It is home to brands that range from Hennessy cognac and Sephora, the cosmetics retailer. Through the acquisition of Tiffany and other jewellery brands, the group has been able to strengthen its position. LVMH is investing in marketing to challenge Richemont’s Cartier.

After other sector players such as Prada, Richemont and Burberry, the earnings release by the group comes shortly after Tod’s pointed out an unabated demand for high-end goods at the close of the last year.

The luxury market rebounded from last year’s health crisis strongly, even though international travel, which was an important growth driver pre-pandemic, is not fully back. However, brands are increasing efforts to reach local consumers and digitally through their channels.

Sales at LVMH for the three last months of 2019 are forecast to be at 18 billion euros. This is approximately 17% higher than the pre-pandemic levels in 2019.