Revenue at LVMH Moet Hennessy Louis Vuitton SA, the world’s largest luxury product group, rose 2% in the first-quarter to 2.85 billion euros ($3.47 billion), compared with the first quarter 2003, the Paris-based group said Thursday. Not counting currency changes, total sales rose by 10%.

“The good sales growth achieved in the second half of 2003 accelerated in the beginning of this year,” LVMH said.

Watches & Jewelry division delivered a 17% sales gain for first quarter of 2004 (with a gain of 30% not counting currency changes) to reach $138 million, the company said. It was the best performer among all of the company’s divisions. TAG Heuer, Zenith, Chaumet, and Montres Dior were among the leaders in this category.

“Within a more favorable economic and monetary environment, the tourism sector has witnessed a sustained recovery and both the U.S. and Asian economies are in full expansion,” LVMH said.

In the first quarter, champagne brands Moet et Chandon, Veuve Clicquot, and Dom Perignon recorded “particularly strong sales in the United States, the United Kingdom and Japan,” LVMH said, powering the wines and spirits division’s 11% increase in revenue to $549 million.

LVMH said its core Louis Vuitton brand delivered double-digit growth, but did not give a precise figure.

However, the broader fashion and leather goods arm, which includes Vuitton, saw sales stagnate at $1.30 billion.

Sales fell 3% to $576 million at perfumes and cosmetics, but LVMH said a strong performance by Christian Dior makeup products in Japan and China had contributed to the increase in sales for the brand.

JCK