LVMH post 16% revenue increase in 2015
LVMH Moët Hennessy Louis Vuitton, the world’s leading luxury group, posted revenues of €35.7 billion ($AUD55.2 billion) in 2015, an increase of 16 per cent over the previous year. The Group turned in strong momentum in Europe, the United States and Japan, whilst the remainder of the Asia Pacific region showed a slight decline.
In the fourth quarter alone, revenue increased by 12 per cent compared to the same period of 2014. Some key highlights to note from the year was the steady growth at some of the European luxury houses, including Louis Vuitton, where profitability remains at an exceptional level and a rise in sales at Fendi, Céline, Givenchy and Kenzo.
French luxury house Christian Dior, who is presently working without a Creative Director continues to impress consumers with strong momentum and continues to gain market share globally.
Bulgari continues to excel with its bling and baubles, whilst TAG Heuer’s refocusing strategy is starting to pay dividends.
The Wines & Spirits business group recorded an increase in revenue of 16 per cent. Champagne experienced good growth in 2015 with an excellent performance in Europe, the United States and Japan. Hennessy demonstrated strong momentum in the United States across all ranges. In China, the second half of the year was marked by a rebound in revenue during a year characterised by continued destocking by distributors.
The Fashion & Leather Goods business group recorded revenue growth of 14 per cent in 2015. Louis Vuitton had a remarkable year driven by the enthusiastic welcome of both its iconic products as well as the new models created by Nicolas Ghesquière. Fendi recorded exceptional growth with the success of its iconic leather goods and the inauguration of Palazzo Fendi in the center of Rome. Loro Piana continued to invest in its production capacity and launched an exceptional new material combining vicuña wool and baby cashmere. Donna Karan and Marc Jacobs continued to work on changes to their product lines.
The Watches & Jewellery business group recorded revenue growth of 19 per cent. The watch brands were impacted by the cautious purchasing behaviour of multi-brand retailers. TAG Heuer launched with enormous success its smartwatch developed in partnership with Google and Intel while continuing to develop its core offering. Given its strong growth, Hublot strengthened its production capacity with the opening of a second manufacturing facility in Nyon, Switzerland.
The Selective Retailing business group recorded revenue growth of 18 per cent. Sephora had an exceptional year in terms of revenue and results and continued to gain market share in all its markets. The omni-channel strategy accelerated with numerous initiatives in several countries. DFS continues to experience an uncertain environment in Asia as a result of currency and geopolitical changes, while its business in Japan benefited from a boom in Chinese tourism. Significant cost containment efforts were continued at DFS.
For the Perfumes & Cosmetics business group, sales were up by 15 per cent. Christian Dior accelerated its growth and increased worldwide market share. The new men’s fragrance Sauvage experienced unprecedented worldwide success. The vitality of its iconic perfumes J’adore and Miss Dior together with the excellent reception of new make-up products contributed to the Maison’s remarkable performance.
Despite a climate of economic, currency and geopolitical uncertainties, LVMH are looking to continue its growth momentum across all business groups in 2016. The Group will maintain a strategy focused on developing its brands by continuing to build on strong innovation and a constant quest for quality in their products and their distribution.
LVMH enters 2016 with confidence and has, once again, set an objective of increasing its global leadership position in luxury goods.
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 outstanding 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.”