LVMH Moët Hennessy Louis Vuitton recorded sales revenue up 17% to E.5.2bn ($7.3bn) in the first quarter of 2011, while Selective Retailing – the division in which DFS sits – recorded the same increase. LVMH said that DFS ‘reaped the rewards of its quality strategy’ and benefited from the rise of tourism in Asia, while the renovation and expansion programme for the Macao, Hawaii and Singapore Gallerias continued.
LVMH added that organic revenue growth for the group stood at 14% compared to the same period in 2010, which had itself shown strong growth.
In a statement, LVMH said: “The Group had an excellent start to the year, continuing the trends seen at the end of 2010. The United States, Europe and Asia enjoyed strong momentum. After the earthquake in Japan, the Group’s local teams worked hard to effect a gradual return to normal business.
“All business groups recorded double-digit organic revenue growth in the quarter. Wines & Spirits as well as Watches & Jewelry continued their strong recovery due to a confirmed return in client demand. Louis Vuitton registered double-digit organic revenue growth and accelerated its leadership.”
REVENUE BY BUSINESS GROUP
LVMH said that the Wines & Spirits business reported strong demand in the first quarter, notably in the US and Asia. The division generated sales of E.762m ($1bn) a 20% reported increase and an organic rise of 17%.
Champagne volumes increased by 8% compared to the robust first quarter of 2010, during which distributors’ orders returned. LVMH added that prestige cuvées ‘enjoyed particularly rapid growth’.
Hennessy Cognac volumes were also up 16% maintaining ‘the excellent momentum seen at the year-end’ across all its qualities of Cognac.
FASHION & LEATHER:
The Fashion & Leather Goods generated sales of E.2bn ($2.8bn) reflecting reported organic revenue growth of 13% and reported growth of 17% in the first quarter.
Commenting on the performance of this division, LVMH said: “Louis Vuitton continued its exceptional momentum which was driven by the enthusiasm of both local clients and tourists for its high-quality products.
“Production capacities were expanded in order to support this demand, thanks notably to the new Marsaz workshop in the Drôme region of France. For the first time the brand took part in the Baselworld Watch Fair reflecting the excellence of Louis Vuitton’s watch-making expertise.
“Fendi and Donna Karan continued their rapid revenue growth. Other brands, in particular Céline, experienced a strong progress in activity.”
PERFUME & COSMETICS:
Meanwhile, the Perfumes & Cosmetics division generated sales of E.803m ($1.1bn) which constituted a reported increase of 9% and an organic rise of 11%. Highlights in the first quarter included ‘excellent’ sales for Christian Dior, ‘thanks to the sustained growth of its flagship product ranges’.
LVMH said: “The quarter saw the successful launch of the Dior Addict lipstick and the roll out of a new perfume, Miss Dior, with Natalie Portman as its muse. Guerlain benefited from the rapid growth of its legendary perfume Shalimar and from its skin care range Orchidée Impériale.
“Givenchy’s growth was driven by the success of Play for Her, launched in 2010. Benefit and Make Up For Ever experienced exceptional growth across all markets.”
WATCHES & JEWELRY:
The Watches & Jewelry business group also recorded excellent results, with sales coming in at E.261m ($371m), a reported growth of 28% and an organic rise of 20%. LVMH said this performance was supported ‘by the excellent performance of its own boutiques’ as well as that of multi-brand retail stores. “The watch-making brands revealed their first class innovations at Baselworld. TAG Heuer strengthened its iconic Carrera collection of chronographs with a technical ability unique in the world.
“Zenith, with strong growth, continued the renovation of its Manufacture in Le Locle. Hublot benefited from the strong momentum of its Big Bang and King Power lines and the opening of its own boutiques, notably Place Vendôme. Chaumet’s new Bee My Love collection was very well received.
“De Beers made significant progress in Asia and the United States. The announcement of the strategic alliance with Bulgari was a key highlight of the quarter.”
Last, but not least, the Selective Retailing division generated sales of E.1.4bn ($1.9bn), a reported increase of 20% and a 17% organic rise.
LVMH said: “DFS reaped the rewards of its quality strategy and benefited from the rise of tourism in Asia. The renovation and expansion programme for the Macao, Hawaii and Singapore Gallerias continued.
“Sephora continued to record excellent performances across all its regions. Thanks to its exclusive product offering and innovative services, Sephora increased its market share and accelerated the expansion of its networks into markets with strong potential.”
STRICT COST CONTROLS CONTINUE
Commenting on the overall performance, LVMH concluded: “Taking into account the geopolitical and economic environment, LVMH will continue to focus its efforts on developing its brands, will maintain a strict control over costs and will target its investments on the quality, the excellence and the innovation of its products and of their distribution.
“The Group will rely on the talent and motivation of its teams, the diversification of its businesses and the good geographical balance of its revenues to increase, once again in 2011, its leadership of the global high quality products market.”