LVMH turns in record revenue and operating profit in 2015, even as DFS faces “uncertain environment” in Asia

LVMH-logoLuxury group LVMH Moët Hennessy Louis Vuitton reported revenue of €35.7 billion in 2015, an increase of 16% over the previous year. Organic revenue growth was 6%.

The Group turned in strong momentum in Europe, the United States and Japan, although other Asian countries demonstrated contrasting tendencies.

In the fourth quarter, revenue increased by 12% compared to the same period of 2014. Organic growth was 5%.

 

Selective Retailing

Revenues in the Selective Retailing business, which includes DFS Group and Sephora, rose 18% on a reported basis, and 5% *organically (* With comparable structure and exchange rates. The exchange rate impact is +10%) Profit in Selective Retailing from recurring operations reached €934 million, up 6%.

LVMH reports “exceptional progress” at Sephora which strengthened its position in all its markets and in digital, although DFS continues to “experience an uncertain environment in Asia as a result of currency and geopolitical changes,” said the company.

The DFS business in Japan benefited from a boom in Chinese tourism.

For the whole Group, profit from recurring operations reached €6,605 million in 2015, an increase of 16%. All the LVMH business groups contributed to this growth. Group share of net profit was €3,573 million. Excluding the capital gain realized in 2014 following the distribution of Hermès shares, Group share of net profit increased by 20%.

Bernard Arnault, Chairman and CEO of LVMH, said: “The 2015 results confirm the capacity for LVMH to progress and gain market share despite economic and geopolitical uncertainty. Revenue and operating profit reached new record levels.

“Commitment to excellence, a passion for quality and our capacity to innovate underpin our growth momentum and are all values epitomised by the Fondation Louis Vuitton and its emblematic building that welcomed over one million visitors in 2015. All our Maisons demonstrated out-standing flexibility in 2015.

“By adapting their strategies to global changes and by continuing to evolve, they have shown the creativity and entrepreneurship that drive them forward. In an uncertain economic environment, we can rely on the desirability of our brands and the agility of our teams to further strengthen in 2016 our leadership in the world of high quality products.”

 

Key 2015 highlights include:

∞ Record revenue and profit from recurring operations

∞ Strong progress in Europe, the United States and Japan

∞ Positive impact of exchange rates

∞ Good performance of Wines & Spirits in all regions with a progressive normalization of the situation in China

∞ The success of both iconic and new products at Louis Vuitton, where profitability remains at an exceptional level

∞ Progress at Fashion brands, in particular Fendi, Céline, Givenchy and Kenzo

∞ Remarkable momentum at Christian Dior which gained market share globally

∞ Excellent results at Bvlgari and success of TAG Heuer’s refocusing strategy

∞ Free cash flow of €3.7 billion, an increase of 30%

∞ Exceptional progress at Sephora which strengthened its position in all its markets and in digital

 

Confidence for 2016

LVMH says that “despite a climate of economic, currency and geopolitical uncertainties,” it is well-equipped to continue its growth momentum across all business groups in 2016, and will maintain a strategy focused on developing its brands through strong innovation and a constant quest for quality.

“Driven by the agility of its teams, their entrepreneurial spirit, the balance of its different businesses and geographic diversity, LVMH enters 2016 with confidence and has, once again, set an objective of increasing its global leadership position in luxury goods.”
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