All Luxury Brands that are doing well are the one capitalizing on their Brand Equity, new product collection creativity, the arrival of new creative director for some of them, a strong balanced international business development, a smart Retail - Wholesale model, committed digital investment in Ecommerce and Social Media and finally talented management teams.
The publication of LVMH 2017 first quarter is setting the tone. The Luxury world leader recorded revenue of € 9.9 Billion for the first quarter, an increase of 15% vs last year (13% organic growth). This is remarkable and cover basically all business group ( Fashion & Leather Goods, Wines & Spirits, Perfumes & Cosmetics, Watches & Jewelry).
We have to remember that activities were affected last year from November 2015 after the terrorists attack in Paris.
This is confirming the excellent year 2016 published today by the world leader at the annual general meeting of the Luxury sector that is reporting €37.6 Billion with a reported growth of +5% versus 2015 and a Group Share Net profit at €3.98 Billion ( 10.6% of the Total Sales), +11% versus 2015.
The international development is made of a continued solid growth in the US and in Europe and a resumed growth in Asia. Very nice geographical balance 27% USA, 28% Europe ( out of which France 10%), Asia 32% 8 out of which japan 7%).
LVMH is in a solid financial position, with a free cash flow of 3974 M€ +8% vs last year and a Net Debt to Equity ratio of 12%.
2016 LVMH KEY HIGHLIGHT
- 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, 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 also.
We will have to wait the coming publications of the other luxury groups in all sectors : KERING, RICHEMONT, HERMES, SWATCH GROUP... but Spring is in the air and the dynamic looks promising.
If you are interested to know more, do not hesitate to reach for me directly or one of the members of our team.
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