LVMH showed good resilience against the pandemic crisis in 2020
Paris, January 26th, 2021
LVMH Moët Hennessy Louis Vuitton, the world’s
leading luxury products group, recorded revenue of 44.7 billion
euros in 2020, down 17%. Organic revenue declined 16% compared to
2019. LVMH showed good resilience in 2020 in an economic
environment severely disrupted by the serious health crisis that
led to the suspension of international travel and the closure of
the Group's stores and manufacturing sites in most countries over a
period of several months.
With an organic revenue decline of only 3% in
the fourth quarter, the Group saw a significant improvement in
trends in all its activities compared to the first nine months of
2020. Fashion & Leather Goods in particular, enjoyed a
remarkable performance, with double-digit growth in both the third
and fourth quarters. While Europe is still affected by the crisis,
the United States saw a good recovery and Asia grew strongly.
Profit from recurring operations, which amounted
to 8.3 billion euros in 2020, declined only 28% over the year due
to a return to growth in the second half, which was up 7%.
Operating margin reached 18.6% in 2020. Group share of net profit
amounted to 4.7 billion euros, down 34%.
Bernard Arnault, Chairman and Chief Executive
Officer of LVMH, said: “LVMH showed remarkable resilience against
the unprecedented health crisis the world experienced in 2020. Our
priority has been to protect the health and safety of our employees
and our clients and we have provided direct support in the fight
against the pandemic. Our Maisons have shown great agility and
creative energy in continuing to bring to life our customers’
dreams through a unique digital experience thereby further
strengthening their desirability. Our focus on dynamic innovation
was accompanied by strong commitments to the environment,
sustainability and inclusion. We are starting 2021 with the
pleasure of welcoming the iconic jewelry Maison Tiffany and its
teams to our Group. In a context that remains uncertain, even with
the hope of vaccination giving us a glimpse of an end to the
pandemic, we are confident that LVMH is in an excellent position to
build upon the recovery for which the world wishes in 2021 and to
further strengthen our lead in the global luxury market."
Key highlights from 2020 include:
- Highest priority given to the health and safety of our
employees and our customers,
- Direct support in the fight against the pandemic,
- Good resilience, notably from the major brands, in an economic
environment disrupted by the health crisis,
- Impact of the crisis on revenue trends around the world, with
however, a second half marked by a strong recovery in Asia, which
saw double-digit growth, and a significant improvement in trends in
the United States and Japan,
- Double-digit organic revenue growth at Louis Vuitton and
Christian Dior over the last two quarters of 2020,
- Success of both iconic and new products at Louis Vuitton, whose
profitability remains at an exceptional level,
- Remarkable resilience of Cognac,
- Sharp acceleration in online sales, partially offsetting the
effect on revenue caused by the closure of the Group's stores for
several months,
- Suspension of international travel, severely penalizing hotel
and travel retail activities,
- Operating free cash flow equivalent to that of 2019,
- The completion of the agreement with the iconic American
jewelry Maison Tiffany.
Key figures
Euro millions |
2019 |
2020 |
% change |
Revenue |
53 670 |
44 651 |
- 17 % |
Profit from recurring operations |
11 504 |
8 305 |
- 28 % |
Group share of net profit |
7 171 |
4 702 |
- 34 % |
Operating free cash flow |
6 167 |
6 117 |
- 1 % |
Net Financial debt |
6 206 |
4 241 |
- 32 % |
Total equity |
38 365 |
38 829 |
+ 1 % |
Revenue by business group:
Euro millions |
2019 |
2020 |
Change 2020 / 2019 Reported
Organic* |
Change Q4 2020 / Q4 2019 Organic* |
Wines & Spirits |
5 576 |
4 755 |
- 15 % |
- 14 % |
- 11% |
Fashion & Leather Goods |
22 237 |
21 207 |
- 5 % |
- 3 % |
+ 18% |
Perfumes & Cosmetics |
6 835 |
5 248 |
- 23 % |
- 22 % |
- 15% |
Watches & Jewelry |
4 405 |
3 356 |
- 24 % |
- 23 % |
- 2% |
Selective Retailing |
14 791 |
10 155 |
- 31 % |
- 30 % |
- 26% |
Other activities and eliminations |
(174) |
(70) |
- |
- |
- |
Total LVMH |
53 670 |
44 651 |
- 17 % |
- 16 % |
- 3% |
* With comparable structure and constant exchange rates. For
2020, the currency effect was -1% and the structural impact was
almost zeroFor the fourth quarter of 2020, the currency effect was
-4% and the structural impact was almost zero
Profit from recurring
operations by business group:
Euro millions |
2019 |
2020 |
% change |
Wines & Spirits |
1 729 |
1 388 |
- 20 % |
Fashion & Leather Goods |
7 344 |
7 188 |
- 2 % |
Perfumes & Cosmetics |
683 |
80 |
- 88 % |
Watches & Jewelry |
736 |
302 |
- 59 % |
Selective Retailing |
1 395 |
(203) |
- |
Other activities and eliminations |
(383) |
(450) |
- |
Total LVMH |
11 504 |
8 305 |
- 28 % |
Wines & Spirits: strong recovery in the United
States in the second half of the year and improvement in trends in
China
The Wines & Spirits
business group saw its organic revenue decline by 14% in 2020.
Profit from recurring operations was down 20%. All Maisons showed
great resilience and gained market share. After a significant drop
in volumes in the second quarter, the Champagne business
experienced improved trends in the second half, particularly in the
United States. Beginning in June, Hennessy cognac recorded a strong
recovery, driven notably by demand in the United States. 2020 saw
the integration of the 2019 acquisitions Château d'Esclans and
Château du Galoupet for the first time over a full year,
establishing a strong position for Moët Hennessy in the growing
market for high-end rosé wines. A new high-end rum, Eminente
launched in the third quarter.
Fashion & Leather Goods: remarkable
resilience
In 2020, the Fashion & Leather
Goods, business group recorded a decrease in organic
revenue of only 3% in an environment marked by the closure of
stores over a period of several months. The second half saw a
noteworthy rebound in activity, with double-digit organic revenue
growth in both quarters. China recorded a strong recovery in
revenue beginning in April and the United States in July. The
brands’ strict cost management made it possible to limit the
decline in profit from recurring operations to 2%. Louis Vuitton,
always driven by exceptional dynamism and creativity, was able very
quickly to transform and revitalize its customer relations with a
high quality and efficient digital service. Many innovations were
unveiled throughout the year, such as the Pont 9 range and the 1854
canvas. The Maison's commitment to high quality craftsmanship and
sustainability continues in the form of responsible creativity. A
new workshop opened at Vendôme in France. Christian Dior
demonstrated remarkable momentum and gained market share in all
regions thanks to its exceptional creativity. The Lady Dior bag has
become a global icon, the women’s collections of Maria Grazia
Chiuri and the men’s runway shows of Kim Jones were a huge success.
The other fashion brands showed solid resilience during the year,
notably Loewe with the creations of J. W. Anderson, Celine with the
creations of Hedi Slimane, Fendi and Marc Jacobs.
Perfumes & Cosmetics: continuous innovation and
rapid growth in online sales
The Perfumes & Cosmetics
business group recorded a 22% decline in organic revenue in 2020.
Profit from recurring operations was down 88%. In a sector
suffering from the decline in international traveller spend and
makeup, LVMH’s major brands chose to be selective in their
distribution and, unlike certain competitors, limited promotions
and refused to sell indirectly to the Chinese parallel market,
which presents major risks to the medium term desirability for
brands that follow that route. The Perfumes and Cosmetics brands
are showing good resilience resulting from the growth of skincare
and online sales, particularly in Asia. Christian Dior saw a
gradual improvement in the second half of the year, underpinned by
the success of its new products Miss Dior Roses N’Roses and J’adore
Infinissime in perfume, and Rouge Dior in makeup. Guerlain
benefited from the remarkably dynamic skincare market, with the
continued success of Abeille Royale and Orchidée Impériale. The new
skincare brand Fenty Skin, developed by Rihanna, is off to a very
promising start.
Watches & Jewelry: strong rebound in China in the
second half of the year
The Watches & Jewelry
business group saw its organic revenue decline by 23% in 2020, with
a strong improvement in trends in the fourth quarter, which fell
only 2%. Profit from recurring operations was down 59%. Bvlgari was
very responsive and quickly capitalized on the strong recovery in
China. The Maison maintained a high pace of jewelry innovation with
the successful launches of its Serpenti Viper, B.Zero1 Rock and
Barocko collections. Chaumet inaugurated its new store at its
historic address on Place Vendôme in Paris at the start of 2020 and
strengthened its presence in China. In the watch sector, TAG Heuer
celebrated its 160th anniversary with several limited editions in
the Carrera collection and launched the third generation of its
smartwatch in New York. The year 2021 marks the welcome to the
Group of the prestigious American jeweler Tiffany.
Selective retailing: good resilience at Sephora and
strong impact of the suspension of international travel on
DFS
The Selective Retailing
business group saw organic revenue decline by 30% in 2020. Profit
from recurring operations amounted to (203) million euros. Sephora
demonstrated good resilience during the health crisis, which,
nonetheless, lead to the closure of most of its stores for several
months. The commitment and agility of its teams have enabled an
acceleration of online sales, which reached historic levels in all
markets, and the development of services such as Click &
Collect and Live Shopping. Sephora has also strengthened its
offering with new skincare and hair products. A new partnership has
been signed with the American retailer Kohl's, whose stores are
expected to accommodate 200 beauty spaces dedicated to Sephora in
2021. DFS saw a significant decline in its activity in most
destinations due to the total suspension of international travel.
While Hong Kong continues to feel the impact of the pandemic
strongly, Macau saw improved trends in the latter part of the year.
New services are being developed for its local customers and online
sales have strengthened.
Cautious confidence for 2021
In a very turbulent context, LVMH is
well-equipped to build upon the hoped-for recovery in 2021 and
regain growth momentum for all its businesses. The Group will
continue to pursue its strategy focused on developing its brands by
building on strong innovation and investments as well as a constant
quest for quality in their products and their distribution.
Driven by the agility of its teams, their
entrepreneurial spirit and its well diversified presence across its
activities and the geographic areas in which it operates, LVMH
enters 2021 with cautious confidence and once again, sets an
objective of reinforcing its global leadership position in luxury
goods.
Dividend 2020
At the Annual General Meeting of April 15, 2021,
LVMH will propose a dividend of 6 euros per share. An interim
dividend of 2 euros per share was paid on December 3 of last year.
The balance of 4 euros will be paid on April 22, 2021.
The Board of Directors met on January 26th to
approve the financial statements for 2020. Audit procedures have
been carried out and the audit report is being issued.The regulated
information related to this press release as well as the
presentation of annual results and the “Financial documents” report
are available on the website www.lvmh.com.
APPENDIX
Condensed consolidated accounts for 2020 are
included in the PDF version of the press release.
LVMH - Revenue by business group and by
quarter
2020 Revenue (Euro
millions)
2020 |
Wines &Spirits |
Fashion &Leather Goods |
Perfumes &Cosmetics |
Watches &Jewelry |
Selectiveretailing |
Other activities& eliminations |
Total |
First Quarter |
1
175 |
4
643 |
1
382 |
792 |
2
626 |
(22) |
10 596 |
Second
Quarter |
810 |
3 346 |
922 |
527 |
2 218 |
(26) |
7 797 |
Total First Half |
1 985 |
7 989 |
2 304 |
1 319 |
4 844 |
(48) |
18 393 |
Third
Quarter |
1 364 |
5 945 |
1 370 |
947 |
2 332 |
(3) |
11 955 |
Nine months |
3 349 |
13 934 |
3 674 |
2 266 |
7 176 |
(51) |
30 348 |
Fourth
Quarter |
1 406 |
7 273 |
1 574 |
1 090 |
2 979 |
(19) |
14 303 |
Total 2020 |
4 755 |
21 207 |
5 248 |
3 356 |
10 155 |
(70) |
44 651 |
2020 Revenue (Organic change versus same
period of 2019)
2020 |
Wines &Spirits |
Fashion &Leather Goods |
Perfumes &Cosmetics |
Watches &Jewelry |
Selectiveretailing |
Other activities& eliminations |
Total |
First Quarter |
-14% |
-10% |
-19% |
-26% |
-26% |
- |
-17% |
Second
Quarter |
-33% |
-37% |
-40% |
-52% |
-38% |
- |
-38% |
Total First Half |
-23% |
-24% |
-29% |
-39% |
-33% |
- |
-28% |
Third
Quarter |
-3% |
+12% |
-16% |
-14% |
-29% |
- |
-7% |
Nine months |
-15% |
-11% |
-25% |
-30% |
-31% |
- |
-21% |
Fourth
Quarter |
-11% |
+18% |
-15% |
-2% |
-26% |
- |
-3% |
Total 2020 |
-14% |
-3% |
-22% |
-23% |
-30% |
- |
-16% |
2019 Revenue (Euro
millions)
2019 |
Wines &Spirits |
Fashion &Leather Goods |
Perfumes &Cosmetics |
Watches &Jewelry |
Selectiveretailing |
Other activities& eliminations |
Total |
First Quarter |
1
349 |
5
111 |
1
687 |
1
046 |
3
510 |
(165) |
12 538 |
Second
Quarter |
1 137 |
5 314 |
1 549 |
1 089 |
3 588 |
(133) |
12 544 |
Total First Half |
2 486 |
10 425 |
3 236 |
2 135 |
7 098 |
(298) |
25 082 |
Third
Quarter |
1 433 |
5 448 |
1 676 |
1 126 |
3 457 |
176* |
13 316 |
Nine months |
3 919 |
15 873 |
4 912 |
3 261 |
10 555 |
(122) |
38 398 |
Fourth
Quarter |
1 657 |
6 364 |
1 923 |
1 144 |
4 236 |
(52) |
15 272 |
Total 2019 |
5 576 |
22 237 |
6 835 |
4 405 |
14 791 |
(174) |
53 670 |
* Includes all Belmond revenue for the period April to September
2019.
Alternative performance
measures
For the purposes of its financial communication,
in addition to the accounting aggregates defined by IAS / IFRS,
LVMH uses alternative performance measures established in
accordance with the AMF's position DOC-2015-12.
The table below lists these measures and the reference to their
definition and their reconciliation with the aggregates defined by
IAS / IFRS in published documents.
Measures |
Reference to published documents |
Operating free cash flow |
FD (condensed consolidated financial statements, consolidated cash
flow statement) |
Net financial debt |
FD (Notes 1.22 and 19 of the appendix to the consolidated financial
statements) |
Gearing |
FD (Part 7, Comments on Consolidated Balance Sheet) |
Organic growth |
FD (Part 1, Comments on the Consolidated Income Statement) |
FD: Financial documents as of December 31,
2020
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, Ao Yun, Château d'Esclans and Château du
Galoupet. Its Fashion and Leather Goods division includes Louis
Vuitton, Christian Dior Couture, Celine, Loewe, Kenzo, Givenchy,
Fendi, Emilio Pucci, Marc Jacobs, Berluti, 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,
Tiffany & Co, 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
Universal Registration 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 |
|
France Aymeric Granet Brune
Diricq / Charlotte Mariné Publicis Consultants + 33 1 44
82 47 20 |
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 |
UK Hugh 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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