LVMH reports 19% increase in sales for 2010, exceeding the 20 billion Euro mark for the first time; cosmetics grew 12%

LVMH Moët Hennessy Louis Vuitton, the world’s leading luxury products group, recorded a 19% increase in revenue in 2010, exceeding the 20 billion Euro mark for the first time. All business groups saw excellent momentum in Europe, Asia and the United States. Louis Vuitton, in particular, once again recorded double-digit revenue growth during the year.
Revenue increased by 20% in the fourth quarter with organic growth rising 13%. This performance is in line with the favorable trends observed since the beginning of the year, and compares to the fourth quarter of 2009 which also grew. Profit from recurring operations increased by 29% to 4 321 million Euros. The current operating margin improved by 1.6 percentage points to reach 21.3% in 2010 with all businesses contributing to this performance. Group share of net profit was 3 032 million Euros.
Mr. Bernard Arnault, Chairman and CEO of LVMH, said: “2010 was a great vintage for LVMH. The quality of our products, the originality of our brands and the talent of our teams bolstered by the economic recovery allowed us once again to gain market share throughout the world. In 2011, LVMH intends to further strengthen its global leadership position in high quality products by relying on its sound long term strategy.”
Highlights of 2010 include:

• Profit from recurring operations exceeded 4 billion Euros for the first time,
• Further market share gains throughout the world,
• Continued rapid growth in Asia,
• Double-digit revenue growth and exceptional profitability at Louis Vuitton,
• Strong results from DFS and Sephora which continue to increase their lead over competitors across all regions in which they operate,
• Rapid revenue growth for Wines & Spirits,
• Momentum at Parfums Christian Dior due to the continued success of its iconic perfumes,
• Doubled profit from recurring operations at Watches & Jewelry,
• A 39% increase in free cash flow, which for the first time passed the 3 billion Euro mark,
• Gearing* of 15% as of the end of December 2010.
  * ratio of net debt to equity.

Perfumes & Cosmetics: continued success of star lines

Revenue 2009: € 2.741 billion; revenue 2010: € 3.076 billion (+ 12% reported)
Profit 2009: € 291 million; profit 2010: € 332 million (+ 14%)
Perfumes & Cosmetics recorded revenue growth of 12% in 2010 and an increase in profit from recurring operations of 14%. Parfums Christian Dior benefited from the continued popularity of its iconic perfumes such as J’adore, Poison and Eau Sauvage, while maintaining focus on innovation. Other product categories enjoyed strong growth thanks to the excellent performance of the new Rouge Dior lipstick range and the Capture skincare line. Guerlain benefited from the success of its new Idylle fragrance and the soundness of Shalimar, as well as its skincare line, Orchidée Impériale. The new Play for Her feminine fragrance from Parfums Givenchy was very well received. Benefit and Make Up For Ever enjoyed outstanding momentum throughout the world.

Selective Retailing: strengthened positioning

The Selective Retailing business group recorded revenue growth of 19% in 2010 and an increase of 38% in profit from recurring operations.
"DFS’s excellent performance was due to the rise in international travel, notably among Asian tourists," LVMH informed. The Gallerias of Hong Kong, Macao and Singapore enjoyed remarkable growth and benefited from the investments made in renovation and expansion. New operations in India, the Middle East and Vietnam are promising.
Driven by its innovative concept, Sephora continued to gain market share and recorded comparable store growth across all regions. The good momentum in online sales continued. The rhythm of its store openings continued as well. The opening of flagship stores in 2010 significantly increased its presence in Asia and Europe. Sephora also entered the Latin American market through the acquisition of Sack’s, the leading Brazilian online retailer of selective perfumes and cosmetics. 

Excellent outlook for 2011

"After an exceptional 2010, LVMH is well equipped to continue its growth momentum across all business groups in 2011. Its strategy will remain focused on developing its brands through strong innovation, quality and expansion in high potential markets."
"Driven by the agility of its organisation, the balance of its different businesses and geographic diversity, LVMH enters 2011 with confidence and has set itself the objective of increasing, once again, its global leadership position in luxury goods," LVMH concluded.