LVMH Mo?t Hennessy Louis Vuitton has reported a net profit of E.1.88bn ($2.46bn) for the full year 2006, compared with E.1.44bn the previous year, while revenue jumped 10% to E.15.31bn ($20.02bn) from E.13.91bn.

Chairman and Ceo Bernard Arnault said the results ‘confirmed the strong potential of our high-growth, rising-star brands and the group's leading position in emerging markets.’
Results by division continued to impress with the selective retailing division – which includes the DFS and Sephora chains – posting a 15% rise in profit to E.400m ($523m) on a 7% increase in revenue to E.3.89bn ($5.09bn).
The company said that DFS benefited from its growing Asian clientele in a market that has been affected by the weakness of the yen. LVMH said that DFS continued the renovation of its Galleria at Guam and it also mentioned the well documented construction of the new Galleria at Macao, which is expected to open in or around January 2008.
At the same time, LVMH reported that Sephora continued to expand in Europe, in the US and in China. Its growth accelerated in Europe, led by good progress in France. In the US, there has been double-digit growth in comparable store revenue for the sixth consecutive year. Online sales now constitute a significant activity in the US and have begun well in France.
Having said that, the contribution of DFS to LVMH's coffers has significantly increased in recent years. While LVMH does not break out its constituent retail business results, The Business estimates that DFS' sales turnover last year was close to $2.2bn to $2.4bn (including $400m to $500m from its Starboard retail cruise operations-Ed). Based on the turnover of the whole division quoted by LVMH, that would make Sephora and its other retail interests only slightly bigger than DFS today.
Looking at the other divisions, LVMH said that wines and spirits revenue increased by 13% to E.2.99bn ($3.92bn), showing the strongest growth of all four main divisions. At the same time, fashion and leather goods and perfumes and cosmetics posted 11% revenue growth – contributing E.5.22bn ($6.83bn) and E.2.52bn ($3.3bn) respectively – with Louis Vuitton contributing with ‘double-digit’ expansion (this brand accounts for around 30% of LVMH's total revenue-Ed).
Perfumes and cosmetics profit from recurring operations jumped by 28%, while watches & jewelry, the smallest division, saw profit nearly quadruple to E.80m ($105m) on a 26% rise in revenue to E.737m($964m).
Significantly, Arnault said at the results presentation that he expects Asian currencies – including the yen – to gain in 2007. Shareholders will doubtless go along with that since Japan still accounts for nearly 15% of all LVMH revenue.