LVMH posts analyst-defying first-quarter results
Louis Vuitton Moët Hennessy (LVMH) continued to set the pace for the luxury industry in compiling double-digit sales growth that analysts described as "remarkable"
Louis Vuitton Moët Hennessy (LVMH) continued to set the pace for the luxury industry in compiling double-digit sales growth that analysts described as “remarkable”.
The world’s leading high-quality products group recorded revenue of 10,9 billion euros for the first quarter 2018, an increase of 10%. Organic growth was 13% compared to the same period of 2017, an increase to which all business groups, such as spirits, fashion goods, cosmetics and jewellery, and contributed. The growth would have been 2% higher, were it not for the termination of its Hong Kong International Airport concession at the end of 2017.
Asia, the USA and Europe experienced good growth and the group was set on its upward trajectory by the fast-growing Chinese market.
LVMH paid particular attention to its digital campaign, including its sponsorship for a startup accelerator that aims to encourage entrepreneurs developing new technologies and services for the luxury industry.
The programme is situated in Station F, a former Paris terminal that telecommunications billionaire Xavier Niel has turned into a sprawling campus for startups.
"Digital allows us to reach the client more quickly and directly," Bernard Arnault, LVMH’s chairman and France’s richest man, said at an inauguration ceremony late on Monday for the accelerator. "Innovation and creativity are fundamental values for LVMH."
LVMH has also invested in its ecommerce operations, opening new sites for its Celine handbags and Berluti shoes, as well as the first online store in China for its largest brand, Louis Vuitton, and a new multibrand emporium called 24 Sevres.
“LVMH has long held innovation as a core value. Innovation isn’t just a buzzword at LVMH, it’s a practical obsession, crucial to maintaining our leadership position long-term. Collaborating with startups helps us stay abreast of both business opportunities and ways of working. A healthy startup ecosystem is necessary for a healthy industry.” Ian Rogers, Chief Digital Officer at LVMH.
Frenchman Jean-Jacques Guiony (pictured) has been the CFO of LVMH since 2004, one year after joining the group. The HEC business school graduate previously worked for Banque Nationale de Paris, Merrill Lunch and Lazard Frères. A recipient of the Chevalier de la Légion d’Honneur award, he has also served as the chairman and CEO of La Samaritaine since 2010.
In the buoyant environment of the beginning of this year, albeit marked by unfavourable exchange rates and geopolitical uncertainties, LVMH said it would continue to focus its efforts on developing its brands, maintaining strict control over costs and targeting its investments on the quality, excellence and innovation of its products and their distribution. The Group would also rely on the talent and motivation of its teams, the diversification of its businesses and the geographical balance of its revenue to reinforce its global leadership position in luxury goods.