LVMH picks up record sales for 2018 as Asian markets thrive

Elizabeth Jenkins-Smalley

Elizabeth Jenkins-Smalley

Editor In Chief at The Executive Magazine

The Executive Magazine looks into how the continued popularity on the Asian continent has driven French luxury goods maker LVMH to achieve record revenues and growth for 2018.

Publishing its financial report from last year, LVMH Moët Hennessy Louis Vuitton, one of the world’s leading luxury products group, recorded revenues of US$53.6bn, an increase of a tenth compared to the previous year.

Organic revenue growth was 11% and 12% excluding the impact of the closure of the Hong Kong airport concessions at the end of 2017, and organic revenue growth in the fourth quarter was 10%.

Profit from recurring operations amounted to US$11.6bn in 2018, up 21%. Operating margin reached a level of 21.4%, an increase of 1.9 percentage points. Group share of net profit amounted to US$7.33 billion, up 18%.

In terms of different branches of the company, LVMH’s progress in Wines & Spirits was buoyed by good momentum in China and significant growth in Europe and the United States, allowing the business group to achieve organic revenue growth of 5%.

The Fashion & Leather Goods business group achieved organic revenue growth of 15% in 2018, with profit from recurring operations surging by more than a fifth at 21%.

Of some of LVMH’s key brands, Christian Dior had an excellent first full year within LVMH thanks to the creativity of Maria Grazia Chiuri for the Women’s collections and to the arrival of Kim Jones, the new artistic director of Dior Homme.

Other well-known labels such as Fendi and Loro Piana continued to assert their know-how throughout their collections, and Celine entered a new and ambitious stage of its development with the arrival of Hedi Slimane as artistic, creative and image director of the brand. 

Asia’s influence was evident in the perfumes & cosmetics branch of LVMH, too: rapid progress from the content meant that the business group achieved organic growth of 14% from the performance of its flagship brands.

Parfums Christian Dior experienced remarkable growth and increased its market share in all regions of the world. Makeup and skincare also grew rapidly; Guerlain progressed well, driven in particular by the success of products Abeille Royale in skincare and Rouge G in makeup.

Chairman and CEO of LVMH Bernard Arnault commented: “LVMH had another record year, both in terms of revenue and results. In particular, profit from recurring operations crossed the €10 billion mark.

“The desirability of our brands, the creativity and quality of our products, the unique experience offered to our customers, and the talent and the commitment of our teams are the group’s strengths and have once again made the difference. “In 2019 LVMH will continue its strong dynamic of innovation, targeted investments, combining tradition and modernity, long-term vision and responsiveness, entrepreneurial spirit and a sense of responsibility.”

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