Travel Markets Insider Newsletter Vol. 17 No. 15

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DUFRY. Most of this week’s news is about Dufry.

The Swiss-based travel retailer took another step closer to dominating the airport retail business after receiving approval to acquire World Duty Free by all the relevant antitrust authorities on Aug. 6. The next day it closed on the acquisition of 50.1% of its former rival. Dufry is now preparing a Mandatory Tender Offer for the remaining 49.9% of the WDF shares as required by Italian law. Page 1.

The company’s strategy of diversification is helping the giant operator weather the challenging currency fluctuations in markets such as Russia (which is improving) and Brazil (where the Real is still falling in value). Strong business in the US, the Caribbean and improvements in EMEA and Argentina helped balance the results. See a full report on the first half 2015 earnings on page 2.

In further Dufry news, the company opened its first five Hudson concept stores in RIOGaleão airport, adding to those already open in in Brazil in Brasilia, Natal and São Paulo. Page 3.

WORLD DUTY FREE. Meanwhile, first half 2015 sales at World Duty Free itself maintained momentum and showed double-digit growth, both at current and constant FX. Revenues were backed by strong sales performance across almost all markets, positive impact of exchange rates and new operations in Tenerife Sur, Spain, Helsinki, Eurotunnel France and new business acquired from HMSHost by WDF in Q1 2015 (stores in the airports of Atlanta and Oakland and in the Empire State Building). Higher rents in Spain, the Canary Islands and London Heathrow, and new concession fees in Spain, had a negative impact, however, resulting in a negative value of Euro 52.8 million versus a net profit of Euro 28.0 million in the same period of 2014. Dufry will start to consolidate WDF into the company from this month onwards.

DFASS. The other big story of the week is the award of the DFASS-led TRG Duty Free JV as the preferred bidder for the expanded duty free concession at Dallas/Fort Worth International Airport in Texas. See page 1 for details.

LAWA/ONT. In more US airport news, Los Angeles has agreed to transfer ownership of LA/Ontario International Airport in California back to the neighboring city of Ontario. Story on page 3.

CHICAGO MIDWAY. And Chicago announced a major refurbishment and concessions expansion at its Midway International Airport, saying it will issue an RFP for a single-entity concessions operator next month. See page 4 for more details.

LVMH. Currency fluctuations and the geopolitical environment in Asia impacted first half results at DFS Group, but strong business at Sephora and LVMH’s other business groups led to organic revenue growth of 6% at the luxury goods leader. See page 4.

AT THE POINT OF SALE. Furla opens in MIA. Coach unveils new airport concept. Pages 3 & 4.

PEOPLE. Jerome Blanchard leaves DFA for a new position at Gucci Watch and Jewelry. Kering Eyewear names a familiar name to head up its new Travel Retail Americas business. Page 1.

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