LVMH shows good resilience in the first quarter of 2020
Paris, April 16th, 2020
LVMH Moët Hennessy Louis Vuitton, the world’s
leading high-quality products group, recorded revenue of 10.6
billion Euros for the first quarter of 2020, down 15% compared to
the same period in 2019 and down 17% on an organic* basis. LVMH 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. The Group's
priority is to ensure the safety of its employees and customers.
The LVMH teams have demonstrated their strong commitment and
agility in facing this unprecedented situation, and efforts to
adapt to the current environment are actively underway in order to
control costs and ensure a more selective investment policy. LVMH
has also organized 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 mobilized
to help caregivers and participate in the collective effort by
making hydroalcoholic gel for hand sanitizers, by facilitating the
movement or by producing medical masks or even by sourcing critical
equipment for hospitals. 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.For several weeks, our teams have once
again demonstrated that excellence, creativity and responsiveness
will allow us not only to overcome this crisis but, above all, to
emerge even stronger when it fades.”
Revenue by business group:
In million euros |
Q1 2020 |
Q1 2019 |
% Change Q1 2020 /Q1
2019 |
Reported |
Organic* |
Wines & Spirits |
1 175 |
1 349 |
- 13 % |
- 14 % |
Fashion & Leather Goods |
4 643 |
5 111 |
- 9 % |
- 10 % |
Perfumes & Cosmetics |
1 382 |
1 687 |
- 18 % |
- 19 % |
Watches & Jewelry |
792 |
1 046 |
- 24 % |
- 26 % |
Selective Retailing |
2 626 |
3 510 |
- 25 % |
- 26 % |
Other activities and eliminations |
(22) |
(165) |
- |
- |
Total LVMH |
10 596 |
12 538 |
- 15 % |
- 17 % |
* with comparable structure and exchange rates. The currency
effect for the Group was +1 % and the structural impact was
+1%.
In Wines & Spirits, the
positive currency effect and the firm price increase policy
partially offset the decline in volumes. Revenue was down 14% on an
organic basis in the first quarter of 2020. The US market
demonstrated its 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.
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. Online sales saw
rapid growth. 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.
The Watches & Jewelry
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 Selective Retailing, organic
revenue was down 26% in the first quarter of 2020. While all the
Sephora stores were closed in China for a major part of the
quarter, those located in Europe and the United States have been
closed since mid-March. Online revenue significantly increased over
this period. Shopping in stores has gradually picked up in China
since early April. DFS experienced a significant decline in
activity in most destinations as a result of the suspension of
international travel.
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. 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. 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. LVMH relies on the talent and
motivation of its teams, the diversification of its businesses and
the geographical diversity of its revenue to reinforce, once again
in 2020, its global leadership position in high-quality goods.
At a meeting on April 15th, 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 January 28th for Shareholders’ approval at the AGM on
June 30th, 2020. The dividend for 2019 will therefore be €4.80 per
share and, given the interim dividend paid on December 10th, 2019,
the balance of €2.60 per share will be paid on July 9th, 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.
Regulated information linked to this press
release and presentation available on www.lvmh.com
LVMH LVMH Moët Hennessy Louis
Vuitton is represented in Wines and Spirits by a portfolio of
brands that includes Moët & Chandon, Dom Pérignon, Veuve
Clicquot Ponsardin, Krug, Ruinart, Mercier, Château d’Yquem,
Domaine du Clos des Lambrays, Château Cheval Blanc, Colgin Cellars,
Hennessy, Glenmorangie, Ardbeg, Belvedere, Woodinville, Volcán de
Mi Tierra, Chandon, Cloudy Bay, Terrazas de los Andes, Cheval des
Andes, Cape Mentelle, Newton, Bodega Numanthia and Ao Yun. Its
Fashion and Leather Goods division includes Louis Vuitton,
Christian Dior Couture, Celine, Loewe, Kenzo, Givenchy, Pink
Shirtmaker, Fendi, Emilio Pucci, Marc Jacobs, Berluti, Nicholas
Kirkwood, Loro Piana, RIMOWA, Patou and Fenty. LVMH is present in
the Perfumes and Cosmetics sector with Parfums Christian Dior,
Guerlain, Parfums Givenchy, Kenzo Parfums, Perfumes Loewe, Benefit
Cosmetics, Make Up For Ever, Acqua di Parma, Fresh, Fenty Beauty by
Rihanna and Maison Francis Kurkdjian. LVMH's Watches and Jewelry
division comprises Bvlgari, TAG Heuer, Chaumet, Dior Watches,
Zenith, Fred and Hublot. LVMH is also active in selective retailing
as well as in other activities through DFS, Sephora, Le Bon Marché,
La Samaritaine, Groupe Les Echos, Cova, Le Jardin d’Acclimatation,
Royal Van Lent, Belmond and Cheval Blanc hotels.
“This document may contain certain forward
looking statements which are based on estimations and forecasts. By
their nature, these forward looking statements are subject to
important risks and uncertainties and factors beyond our control or
ability to predict, in particular those described in LVMH’s
Reference Document which is available on the website
(www.lvmh.com). These forward looking statements should not be
considered as a guarantee of future performance, the actual results
could differ materially from those expressed or implied by them.
The forward looking statements only reflect LVMH’s views as of the
date of this document, and LVMH does not undertake to revise or
update these forward looking statements. The forward looking
statements should be used with caution and circumspection and in no
event can LVMH and its Management be held responsible for any
investment or other decision based upon such statements. The
information in this document does not constitute an offer to sell
or an invitation to buy shares in LVMH or an invitation or
inducement to engage in any other investment activities.”
LVMH CONTACTS
Analysts and investors Chris
Hollis LVMH + 33 1 44 13 21 22 |
Media Jean-Charles
Tréhan LVMH + 33 1 44 13 26 20 |
MEDIA CONTACTS |
|
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France Michel Calzaroni / Olivier
Labesse / Hugues Schmitt / Thomas Roborel de Climens DGM
Conseil + 33 1 40 70 11 89 |
Italy Michele Calcaterra, Matteo
Steinbach SEC and Partners + 39 02 6249991 |
UKHugh Morrison, Charlotte McMullen Montfort
Communications + 44 7921 881 800 |
US James Fingeroth, Molly Morse, Anntal
Silver Kekst & Company + 1 212 521 4800 |
China Daniel
Jeffreys Deluxewords +44 772 212 6562 +86
21 80 36 04 48 |
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