LVMH reports revenue slide of -15%, yet ‘rapid growth’ for fashion goods online

By Charlotte Turner |

Louis-Vuitton-IncheonT1LVMH Moët Hennessy Louis Vuitton, registered a revenue decline of 15% to €10.6bn/$11.5bn in the first quarter of 2020, down 17% on an organic basis.


The Selective Retailing division – which includes luxury travel retailer, DFS Group and world-renowned chain of personal care and beauty stores, Sephora – posted a dramatic 26% decline in organic revenue during the same period.


Unsurprisingly, “DFS experienced a significant decline in activity in most destinations as a result of the suspension of international travel,” said the group.


While all the Sephora stores were closed in China for a prolonged period in Q1, those located in Europe and the United States have been closed only since mid-March.


However, LVMH says that online revenue – in the selective retailing division – significantly increased over this period and that shopping in Chinese stores has gradually picked up since early April. LVMH also said that “online sales saw rapid growth,” in its fashion & leathergoods division.



LVMH said it has ‘proven its ability to be resilient in an economic environment disrupted by a serious health crisis’ that has led to the closure of stores and manufacturing sites in most countries in recent weeks, as well as the suspension of international travel.

LVMH results Q1 2020 by division

The Group said its priority is to ensure the safety of its employees and customers and that the LVMH divisions have demonstrated ‘their strong commitment and agility’ in facing this unprecedented situation.


“Efforts to adapt to the current environment are actively underway in order to control costs and ensure a more selective investment policy,” said the company.


LVMH has also organised the business to support the collective efforts being undertaken to combat Covid-19. Numerous solidarity initiatives have been rolled out by the Group’s Maisons around the world to support health authorities and medical staff.


Bernard Arnault, Chairman and Chief Executive Officer of LVMH, said: “In this unprecedented context, I would first like to thank our teams around the world, who have mobilised to help caregivers and participate in the collective effort by making hydroalcoholic gel for hand sanitisers, by facilitating the movement or by producing medical masks or even by sourcing critical equipment for hospitals.


Bernard Arnault LVMH Chairman and CEO

“Thanks to everyone’s commitment and the strength of its brands, the LVMH group maintains good resilience in the face of this worldwide challenge,” said Bernard Arnault in a company statement. (Pictured here in 2017).


“The health and safety of our employees and customers must remain our top priority. On a global scale, the Group works closely with the teams of each of our Maisons to provide them with all the resources they need.


“Thanks to everyone’s commitment and the strength of its brands, the LVMH group maintains good resilience in the face of this worldwide challenge.”


In Wines & Spirits, the positive currency effect and the firm price increase policy partially offset the decline in volumes, said the Group. However, revenue was still down 14% on an organic basis in the first quarter.


The US market demonstrated ‘good resilience’ over the period, supported by advance orders from distributors. Hennessy Cognac slowed down in China given lower demand linked to the epidemic and to the timing of 2020 Chinese New Year.

LVMH is very proud of its new multi-million euro Pont Neuf Hennessy complex.

Hennessy Cognac slowed down in China.


The Fashion & Leather Goods business group recorded a decline in organic revenue of 10% in the first quarter of 2020 in a market environment ‘defined by store closures in several regions around the world’, LVMH highlighted.


Louis Vuitton and Christian Dior, in particular, continued to show creative momentum, as illustrated by the latest runway shows and continuous enhancements to their iconic products.


The other brands continued the efforts to strengthen their resilience. Manufacturing sites of the Group’s Maisons are preparing to reopen with maximum safety conditions for employees following the suspension of activity in mid-March.


In Perfumes & Cosmetics, organic revenue decreased 19% in the first quarter of 2020. The major brands demonstrated their resilience as retailers reduced their inventory levels given the current crisis. Online sales grew rapidly.


001a tag heuer watch

TAG Heuer has been affected by the reduction of orders by retailers.

The Watches & Jewellery business group recorded a 26% drop in organic revenue in the first quarter of 2020. Bvlgari experienced a decline in its activity due to the closure of its stores, in Asia in particular.



After a good start to the year, TAG Heuer and Hublot were affected by the reduction of orders by retailers. One of the major innovations of the quarter was the very successful launch of TAG Heuer’s new smart watch.


“In a very turbulent context, the Group will maintain a strategy focused on preserving the value of its brands, based on the exceptional quality of its products and the responsiveness of its teams,” it said in a statement.


“In the current situation, the Group will further strengthen its policy of controlling costs and being selective in its investments. The closures of the Group’s manufacturing sites and stores in most of the world’s countries in the first half will have an impact on the annual revenue and results.”


LVMH said that this impact cannot be precisely evaluated at this stage without knowing the timetable for a return to normal business in the different areas where the Group operates.


“We can only hope that the recovery happens gradually from May or June after a second quarter which will still be very affected by the crisis, in particular in Europe and the US,” it continued.


At a meeting on 15 April, 2020, the LVMH Board of Directors assessed the economic situation resulting from the Covid-19 pandemic and, in light of current events and governmental recommendations, decided to propose a 30% reduction in the dividend announced on 28 January for Shareholders’ approval at the AGM on June 30, 2020.


In addition, the Board was informed of the decision taken by Bernard Arnault, as Chairman and Chief Executive Officer, and by each of the other Executive Board members to give up their remuneration for the months of April and May 2020 as well as all the variable remuneration relating to 2020.


Finally, the Board members of the Company took the decision to reduce their attendance fees by 30% for 2020.

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