LVMH had a record year in terms of sales in 2019, but the world’s number one luxury goods company saw its sales slow in the last quarter, due to the unrest in Hong Kong and a VAT increase in Japan.
By Luxus Plus
The luxury giant is doing very well. On Tuesday, the LVMH group published its 2019 results: turnover stood at 53.7 billion euros.
A record year for the manufacturer of jewelry, luxury luggage and champagne.
Sales thus increased by 15% in published data and by 10% in organic terms, compared to 2018.
These results are in line with the expectations of the Bloomberg and Factset agencies, which hoped for a turnover of 53.5 billion euros.
The group sees its net profit reach 7.17 billion euros, representing a growth of 13% over one year.
Its current operating profit stood at 11.5 billion euros, up 15%, while the current operating margin stood at 21.4%, identical to the previous year. “LVMH has had another record year in terms of both sales and results,” said Bernard Arnault, quoted in the press release.
“In a buoyant but uncertain economy, we will remain vigilant and focused on our progress objectives. We can count on the power of our brands and the agility of our teams to further strengthen our lead in the world of high-quality products in 2020, ”he said. LVMH stresses that Europe and the United States “experienced good growth over the year, as did Asia despite a difficult context in Hong Kong in the second half of 2019”.
In the fourth quarter, the group experienced organic sales growth of 8%, less than in previous quarters (between 11% and 12%).
This is explained by “the increase in VAT in Japan and the movement of stock at cognac distributors in the United States,” he said.
“Restated” for these non-recurring effects, “the group’s organic growth was at a level equivalent to the third and fourth quarter,” according to the press release.
The luxury giant remains supported by its flagship Fashion and Leather Goods division (and its behemoth Louis Vuitton) whose sales jumped 17% to reach 22.2 billion euros.
At the general meeting of shareholders in April, LVMH indicates that it will propose a dividend of 6.80 euros per share, up 13%.
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