LVMH scores 15% rise in total revenues in first half of 2017
today Jul 26, 2017
Downturn? Somebody forgot to tell that to LVMH, which posted a 15 % increase in registered revenues in the opening six months of 2017, powered by “outstanding momentum” at Louis Vuitton; the integration of luggage maker Rimowa and solid growth at Bulgari and TAG Heuer.
LVMH Moët Hennessy Louis Vuitton – to give the group its full title – announced Wednesday evening, July 26, that total sales had grown to €19.714 billion. Profit from recurring operations rose to €3 640 million in the first half, an increase of 23%.
“LVMH has enjoyed an excellent first half, to which all our businesses contributed. In the current climate of geopolitical and economic instability, creativity and quality, the founding values of our Group, have more than ever become benchmarks for all. The increasing digitalization of our activities furthermore reinforces the quality of the experience we bring to our customers,” said LVMH Chairman Bernard Arnault in a statement.
The results were the first since the Arnault family announced plans to merge Christian Dior Couture into LVMH - a move that will raise their total personal stake in LVMH from 36% to 46%.
The world’s largest luxury conglomerate, LVMH boasts the largest market capitalization of any company in France. Arnault is highly sensitive about the conglomerate’s stock price. Doubly so, as quoted fashion brands can suffer wide swings in stock price due to rapid changes in public perceptions of these marques. One reason that LVMH traditionally releases its results after 6PM in France, when the Paris Bourse is closed for trading. As it did again today.
Breaking down the business by product category, LVMH’s largest division, Fashion & Leather Goods, saw revenues advance by 17 percent to €6.899 billion, boosted by two key Vuitton collaborations – with artist Jeff Koons and NYC skateboard brand Supreme.
Nonetheless, Arnault was wary about the second half of 2017: “In an environment that remains uncertain, we approach the second half of the year with caution.”
Selective retailing, which includes cosmetics chain Sephora and international luxury chain Duty Free, saw sales surge 15% to €6.280 billion. Buoyed by Sephora’s expanding network, notably in New York and Dubai, and the launch of 24Sevres, the new online shopping experience developed by department store Le Bon Marché.
Perfumes & Cosmetics sales advanced by 14% to €2.670 billion, as Guerlain enjoyed the “successful launch of its new perfume, Mon Guerlain, represented by Angelina Jolie.”
While Wines & Spirits grew 12% to €2.294 billion, powered on by the recovery of demand in China, where sales of cognac had collapsed in the recent past during the Communist Party official anti-corruption drive when conspicuous consumption was frowned upon.
Finally, Watches & Jewelry advanced 14% to €1.838 billion, as Bulgari registered “an excellent first half.”
With some 130,000 employees worldwide, LVMH controls luxury’s greatest stable of top shelf brands: its extensive portfolio includes Moët & Chandon, Dom Pérignon, Veuve Clicquot, Krug, Ruinart, Château d'Yquem, Hennessy, Vodka Belvedere, Louis Vuitton, Céline, Kenzo, Givenchy, Fendi, Emilio Pucci, Marc Jacobs, Loro Piana, Berluti, Guerlain, Parfums Givenchy, Parfums Kenzo and Perfumes Loewe. LVMH also controls Chaumet, Zenith, Fred and Hublot.
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