Shares in LVMH, the French luxury brand conglomerate run by billionaire Bernard Arnault, fell on Tuesday (28 Jul) following news that second quarter sales had slumped 38% and that profits had nosedived 68% in the first half of the year amid what’s expected to be the worst-ever quarter for the luxury goods industry.

LVMH’s operating profits of €1.67bn were almost €1bn shy of analysts’ expectations. While sales of fashion and handbags from ‘big guns’ such as Louis Vuitton and Dior held up better than jewellery sales from brands like TAG Heuer and Bulgari, second-quarter sales fell 38% after falling 17% in the first.

The damage was done by store closures and travel restrictions that impacted both its sales in China, a key segment of its business, and in major European cities and airports, much of which is driven by US tourist traffic.

Industry analysts have forecast sales of personal luxury goods could shrink by up to 30% this year and might not recover to 2019 levels until 2023.