Luxury goods maker LVMH (LVMHF) posted a massive 15% gain in first-quarter sales as demand for leather and fashion items spiked, and sales of its Hennessy cognac were so strong it could run short of bottles for the rest of the year.

Shares in the Paris-based owner of Fendi, Kenzo and Louis Vuitton climbed over 2% in early trading on Tuesday to €211.70 after revenues climbed to €9.88 billion ($10.5 billion) over the first three months of the year, easily topping analyst expectations of about €9.5 billion.

"Given the magnitude of the beat vs. consensus expectations and the strongest results coming in the highest margin divisions (Fashion & Leather and Wines & Spirits) we would expect consensus revisions of at least +1% to 2%," Goldman Sachs analysts including Richard Edwards noted. "We see positive read-across for spirits names such as Pernod and Remy Cointreau given the implied strength in Cognac driven by both the US and China, a potential indicator of recovering category performance in the key Asian market."

Pernod (PDRDY) climbed almost 1% to €113.10 in early Tuesday trading on the Paris exchange, while Remy Cointreau (REMYF) was up 1.2% to €93.10.

LVMH's results also confirmed a wider uptick in demand for luxury fashion goods after local rivals Kering (PPRUY) , which owns the Gucci label, and Hermes  (HESAY) also posted strong figures on the back of growing demand out of China and the U.S., and as tourists returned to France after terrorist attacks at the end of 2015 and in 2016.

"LVMH benefited from a favorable comparison base, particularly in Europe, where activity was affected last year by the impact of the November 2015 attacks in Paris," the company noted. "The trend currently observed cannot reasonably be extrapolated for the full year."

Organic sales, which strip out the effects of acquisitions, rose 13% over the first quarter, led high by LVMH's Fashion & Leather Goods division, which rose 15% to €3.4 billion. Wine and spirits sales climbed 13% to €1.2 billion, driven by a spike in demand for Hennessy that "could impact the availability of stocks for the rest of the year," said LVMH.       
 
Perfume and cosmetics sales climbed 12%, watches and jewelry rose 11% and selective retailing, which includes the Sephora retail outlets as well as duty free retailer DFS, climbed 11%.

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