The Business of Fashion: LVMH Moët Hennessy Louis Vuitton Announces Record 2016 Results

LVMH Moët Hennessy Louis Vuitton, the world’s leading luxury products group, recorded revenue of €37.6 billion in 2016, an increase of 5% over the previous year. Organic revenue growth was 6%.lvmh-moet-hennessy-louis-vuitton

In the fourth quarter, revenue increased by 9% compared to the same period of 2015. Organic growth was 8%. The American market remains on a good track as does Europe. Asia, excluding Japan, continued its good momentum.

Profit from recurring operations reached €7 billion in 2016, an increase of 6%, to which all business groups, apart from selective distribution, contributed. This result compares to 2015 which was itself a year of growth. Operating margin reached 18.7%. Group share of net profit was €3 981 million, representing growth of 11%.

Bernard Arnault, Chairman and CEO of LVMH, said: “LVMH achieved an excellent performance in 2016 within a context of geopolitical and economic instability. Continued innovation, entrepreneurial spirit and the quest for excellence: all Maisons continue to assert these core values while maintaining rigorous execution of their strategies on the ground. In an environment which remains uncertain, we can count on the appeal of our brands and the agility of our teams to strengthen, once again in 2017, our leadership in the universe of high quality products.

Key highlights from 2016 include:

  • Record revenue and profit from recurring operations
  • Growth in the United States, Europe and Asia
  • Good performance of Wines & Spirits in all regions
  • The success of both iconic and new products at Louis Vuitton, where profitability remains at an exceptional level
  • Progress at Fendi
  • The sale of Donna Karan and the acquisition of Rimowa, a leader in luggage of excellence
  • Good momentum at Parfums Christian Dior driven by successful product innovations
  • Market share gains at Bvlgari and TAG Heuer
  • Growth at Sephora which strengthened its position in all its markets and in digital
  • Free cash flow of €3 974 million, an increase of 8%
  • Gearing of 12% at end of December 2016

WINES & SPIRITS: GOOD YEAR WITH PROGRESS IN THE UNITED STATES AND REBOUND IN SHIPMENTS TO CHINA

The Wines & Spirits Business Group recorded an increase in organic revenue of 7 %. On a reported basis, revenue growth was 5 %. Profit from recurring operations increased by 10 %. With volumes up 3%, solid growth continues for champagne and prestige cuvees performed particularly well. Hennessy cognac enjoyed an excellent year with 10% volume growth. The American market is growing well and China saw better momentum after a tough 2015 due to destocking by distributors. Other spirits, Glenmorangie and Belvedere, continued their growth.

LVMH Moët Hennessy Louis Vuitton is represented in Wines and Spirits by a portfolio of brands that includes Moët & Chandon, Dom Pérignon, Veuve Clicquot Ponsardin, Krug, Ruinart, Mercier, Château d’Yquem, Domaine du Clos des Lambrays, Château Cheval Blanc, Hennessy, Glenmorangie, Ardbeg, Belvedere, Chandon, Cloudy Bay, Terrazas de los Andes, Cheval des Andes, Cape Mentelle, Newton, Bodega Numanthia and Ao Yun.

FASHION & LEATHER GOODS: GOOD PERFORMANCE OF LOUIS VUITTON, OTHER BRANDS STRENGTHENED THEIR POSITIONS

The Fashion & Leather Goods Business Group recorded organic revenue growth of 4% in 2016. On a reported basis, revenue growth was 3 %. Profit from recurring operations increased by 10%. Louis Vuitton had a good year driven by the level of creativity across all its businesses. The continued success of its iconic product range and the strong demand for recent creations such as the new luggage designed by Marc Newson and the Louis Vuitton fragrances, all contributed to this growth. Fendi recorded robust growth crossing the symbolic revenue threshold of 1 billion euros during the year. Loro Piana continued to expand its distribution network and opened a flagship store in Paris. Céline, Loewe and Kenzo all continued to grow. Marc Jacobs continued to work on changes to its collection. Donna Karan was sold in December to the American G-III group. Rimowa, world leader in luggage of excellence, joined the LVMH group.

Its Fashion and Leather Goods division includes Louis Vuitton, Céline, Loewe, Kenzo, Givenchy, Thomas Pink, Fendi, Emilio Pucci, Marc Jacobs, Berluti, Nicholas Kirkwood, Loro Piana and Rimowa.

PERFUMES & COSMETICS: CONTINUED SUCCESS OF INNOVATIONS; EXCELLENT PERFORMANCE IN MAKEUP

The Perfumes & Cosmetics Business Group recorded organic revenue growth of 8%. On a reported basis, revenue growth was 6%. Profit from recurring operations increased by 5%. The inauguration of the new atelier for the creation of fragrances, Les Fontaines Parfumées, at Grasse was a highlight of the year. Parfums Christian Dior grew market share in all regions, driven by the worldwide success of Sauvage and the vitality of its iconic perfumes J’adore and Miss Dior. The progress of makeup also contributed to the Maison’s excellent performance. Guerlain benefitted from the successful launch of its new makeup collection inspired by its fragrance La Petite Robe Noire. Benefit experienced strong growth driven by the success of its new collection for eyebrows. Make Up For Ever, Fresh and Kat Von D performed well.

LVMH is present in the Perfumes and Cosmetics sector with Parfums Christian Dior, Guerlain, Parfums Givenchy, Kenzo Parfums, Perfumes Loewe as well as other promising cosmetic companies (BeneFit Cosmetics, Make Up For Ever, Acqua di Parma and Fresh).

WATCHES & JEWELRY: MARKET SHARE GAINS FOR BVLGARI AND TAG HEUER

The Watches & Jewelry Business Group recorded organic revenue growth of 5%. On a reported basis, revenue growth was 5%. Profit from recurring operations increased by 6%. Bvlgari continued to gain market share with enhancements to its Serpenti, Diva and B.zero1 lines. Growth continued in China, Korea and in the Middle East. TAG Heuer grew despite a difficult market for watches, gained market share and benefitted from the success of its new collections and its connected watch. Hublot accelerated its development in Asia and recorded the best year in its history. Chaumet continued to move its product lines upmarket and inaugurated a new boutique concept in Hong Kong.

LVMH‘s Watches and Jewelry division comprises Bulgari, TAG Heuer, Chaumet, Dior Watches, Zenith, Fred, Hublot and De Beers Diamond Jewellers Ltd, a joint venture created with the world’s leading diamond group.

SELECTIVE RETAILING: GOOD PERFORMANCE AT SEPHORA, DFS IMPACTED BY A DIFFICULT TOURISM CONTEXT IN ASIA

The Selective Retailing Business Group recorded organic revenue growth of 8%. On a reported basis, revenue growth was 7%. Profit from recurring operations declined by 2%. Sephora gained market share across all regions and once again recorded double-digit growth in both revenue and profits. More than a hundred stores were opened in 2016 including notably a flagship store in the World Trade Center in New York and major renovations in Boston and Singapore. Its online offer accelerated with the launch in six new countries. DFS continued to face a difficult environment, notably in Hong Kong. The expansion into new destinations continued. The opening of the T Galleria in Angkor in Cambodia and one in Venice, Italy were the highlights of the year.

LVMH is also active in selective retailing as well as in other activities through DFS, Sephora, Le Bon Marché, La Samaritaine, Royal Van Lent and Cheval Blanc hotels.

Key figures:

             
Euro millions    

2015

 

2016

 

% change

Revenue    

35 664

 

37 600

 

+ 5 %

Profit from recurring operations    

6 605

 

7 026

 

+ 6 %

Group share of net profit    

3 573

 

3 981

 

+ 11 %

Free cash flow*    

3 679

 

3 974

 

+ 8 %

Net financial debt    

4 235

 

3 265

 

– 23 %

Total equity    

25 799

 

27 903

 

+ 8 %

* Before available for sale financial assets and investments, transactions relating to equity and financing activities Continue reading

Uncork the World’s Greatest Champagnes with Champagne Masters

A Multi-Media Champagne Education Tool produced by Moet Hennessy USAmoet_digital_logo-bk

Just in time for the end-of-year holiday party season, Moët Hennessy USA announces the launch of ChampagneMasters.com, a mobile-ready education portal that teaches wine lovers the finer points of Champagne by examining five of the most esteemed Champagne houses in the world. 

Champagne Masters (PRNewsFoto/Moet Hennessy USA)

Champagne Masters (PRNewsFoto/Moet Hennessy USA)

Taking a cue from how sommeliers are classically trained, the website is organized into three sections: Think Like a Master, Taste Like a Master and Serve Like a Master:

  • Think Like A Master: Features a Champagne overview, reading resources and deep conversations between top sommeliers and world-class cellar masters.
  • Taste Like A Master: Learn the art and science of tasting with five legendary wines:
    • Moët & Chandon: The Champagne of Success & Glamour since 1743. It delights with bright fruitiness, a seductive palate, and elegant maturity.
    • Veuve Clicquot: Each Cuvée is true to the Veuve Clicquot style and spirit, faithfully maintained to the standards of Madame Clicquot: “only one quality – the finest.”
    • Dom Pérignon: A vibrant, living, perpetually renewed homage that evokes Dom Pierre Pérignon, the spiritual father of Champagne.
    • Krug: Since 1843, six generations of the Krug family have cultivated the markedly individual character of their exceptional Champagne.
    • Ruinart: The oldest producer of Champagne, officially founded in 1729 by Nicolas Ruinart, who was the nephew of the monk Dom Thierry Ruinart.
  • Serve Like A Master: Select, open and pour Champagne like a pro with a comprehensive glossary of terms, food pairing ideas and a step-by-step guide to opening a bottle.

    Champagne Masters (PRNewsFoto/Moet Hennessy USA)

    Champagne Masters (PRNewsFoto/Moet Hennessy USA)

We built ChampagneMasters.com to help wine lovers better understand, appreciate and enjoy Champagne. We hope that the website’s rich conversations and educational tools will help grow the category and inspire a new generation of consumers to dive deeper into this storied beverage,” said Jon Potter, Chief Marketing Officer & Executive Vice President Brands at Moët Hennessy USA.

ChampagneMasters.com will continue to evolve over time, becoming an indispensable tool for every aspiring champagne master. It will also be supported by a national advertising campaign in print, digital and social media channels.

Link:  http://www.champagnemasters.com

Add to Home Screen Instructions: Follow these instructions to place a Champagne Masters icon on your phone’s home screen.

  • Open your smartphone’s web browser and visit: http://www.champagnemasters.com
  • iPhone: Tap the center button at the bottom nag of your browser. Then select ‘Add to Home Screen
  • Android: Tap the menu button on either your device or the browser. Then select ‘Add to Home Screen

 

MOËT HENNESSY USA is the leading importer and marketer of luxury wines, spirits and champagnes in the U.S. The Moët Hennessy portfolio includes renowned brands such as: Hennessy Cognac; Moët & Chandon, Dom Pérignon, Krug, Veuve Clicquot and Ruinart Champagnes; Belvedere vodka; Grand Marnier; Glenmorangie and Ardbeg single malt Scotch whiskies; and fine wines, including Chateau d’Yquem, Cape Mentelle, Cloudy Bay, Newton Vineyard, Numanthia, Terrazas and Domaine Chandon California sparkling and still wines. Moët Hennessy has a strong consumer focus with an uncompromising commitment to building luxury brands.