lvmh sales 2003...sephora europe • excellent customer reception of loyalty card launched in france...
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LVMHSales 2003
22nd January 2004
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Sales 2003 Highlights
In a difficult environment,
• Organic sales growth continued• Full year +4%
• Accelerated in Q4 to +8%
• Exceptional - double digit - organic sales growthat Louis Vuitton full year and Q4
• Successful product launches for Perfumes
• DFS and Sephora US profitable
• Watches & Jewelry resume growth
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LVMHSales 2003
In millions of Euros
12 693
Structure-1%
Change-9%
Organic+4%
11 962
Q1 Q2 Q3 Q4
2 801 2 435
2003
2 9343 792
2002 2003
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Analysis of sales increasein Q4 2003
In millions of Euros
3 848
Structure -1%
Change-8%
Organic+8%
3 792
Q4 2002 Q4 2003
4
France
Europe
USA (inc. Hawaii)
Japan
Asia
Others7%
13%17%
21%
26%
16%
LVMH Sales 2003 by region in Euros
In % of total sales
2003
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Sales 2003 Evolution in the US (in dollars)
Wines & Spirits +7%Fashion & Leather +12%of which Louis Vuitton +38%
Sephora +21%DFS +2%Total LVMH Group + 6%
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Sales 2003 Evolution in Japan (in Yen)
Champagne & Wines +19%
Hennessy Cognac -11%
Fashion & Leather +12%of which Louis Vuitton +13%
Perfumes & Cosmetics +15%
Watches & Jewelry +8%
Total LVMH Group + 12%
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Wines & Spirits Sales 2003
In millions of Euros
Structure- 1%
Change- 11%
Organic+5%
2 266
855
1 411
2 114
1 335
407
779
390550
767
2002 20032003
Champagne & Wines
Cognac & Spirits
197 156 211 215
210 234339
552
Q1 Q2 Q3 Q4
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Wines & Spirits - Champagne Good resistance of key brands
• Increase in annual champagne volumes of 1% (excluding Pommery and Canard-Duchêne)
• Positive depletions at end December in US• Strong sales increases in UK and Japan• Good progress in still wine sales• Continued improvement of international distribution
in partnership with Diageo• Disposal of non strategic assets
(Canard Duchêne,Chandon Espagne)
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Wines & Spirits - Cognac Sustained increase in the US
• Increase of 5% in Hennessy volumes in 2003• Continued sales growth in the US• Positive depletions in the US• Good performance in Asian markets – Taiwan
and China in particular• Strong growth of VSOP & XO quality in Q4 • December launching of Hennessy’s Ellipse,
a super-premium cognac• Significant negative currency effect partially
compensated for at operating income level by a good hedging cover
• Sale of Hine in first half 2003
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Fashion & Leather Goods Sales 2003
In millions of Euros
Organic+9%
Change-11%
Structure+1%
4 2074 150
Q1 Q2 Q3 Q4
1 068
8281 035
1 219
2003 2002 2003
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Louis Vuitton - A remarkable increasein 2003 environment
• Double digit growth at constant currency• Strong sales increases to local customers, US up 38%
in dollars for the year• Increase in production capacity in response to a strong
demand (notably for the multico bags)• Considerable success of Tambour watch collection• Continued expansion of distribution network
• New stores in Q4 in Riyadh , Guangzhou (China), Tainan(Taiwan), Pacific Place HK (extension)
• 317 stores including 76 in Europe, 47 in Japan,72 in Pacific Asia and 91 in the US
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Fashion & Leather GoodsParticularly strong growth in Q4
• Acceleration of organic growth in Q4• +12% following strong Q4 2002 growth
• Double digit sales increase at constant currencyat Céline in 2003, with particularly good Q4 performance in Japan
• Fendi: reinforced quality of its distribution network, double-digit sales increase at constant currency in Q4
• Double digit full year sales increases for Marc Jacobs, Pucci and Berluti
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Perfumes & Cosmetics Sales 2003
In millions of Euros
2 336
Organic+4%
Structure-4%
Change-7%
2 181
Q1 Q2 Q3 Q4
486 488 506
701
2003 2002 2003
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Perfumes & CosmeticsStrong innovation
• Organic growth of 4% in 2003, outperforming global market,despite difficult US and travel retail markets
• Good performance at Parfums Christian Dior,particularly in Japan
• Successful launch of new products• Capture R60/80 beauty product at Dior• Womens’ perfumes - Very Irresistible de Givenchy
and L’Instant de Guerlain• Men’s fragrances - Kenzo Air at Kenzo Perfumes
and Higher Energy at Dior
• Strong progress at BeneFit Cosmetics• Disposal of Kenneth Cole, Parfums Marc Jacobs
and Michael Kors licenses
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Watches & JewelrySales 2003
In millions of Euros
552
Structure-1%
Change- 8%
Organic0%
502
Q1 Q2 Q3 Q4
97113 125
167
2003 2002 2003
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Watches & JewelrySecond half recovery in sales
• Recovery in sales in second half in difficult marketand competitive environment
• Reinforced creativity of brands• New Formula 1 and Link products (TAG Heuer)• New models of Chronomaster, Open and Star (Zenith)• New Liens and Frisson (Chaumet) and Move One (Fred) collections• Chris 47, Admit it and La D at Dior
• Targeted expansion of the international distribution network• Opened 3 De Beers stores in Tokyo department stores• New Chaumet stores in Geneva and corners/shop in shops in Japan
• Sale of Ebel part of strategy to concentrate on strong brands
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Selective Distribution Sales 2003
In millions of Euros
3 337
Organic+1%
Change-10%
Structure0%
3 039
Q1 Q2 Q3 Q4
745608
725
961
2003 2002 2003
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Selective DistributionDFS
• Progressive recovery of tourism• Increased sales, at constant currency in Q4…
• …. full year sales lower than 2002
• Re-negotiation of airport concessions(notably Hawaii and Los Angeles)
• Continued cost reductions (transfer of certain corporate functions to Hong Kong, close to strong potential markets)
Objective of profitability in 2003 achieved
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Selective DistributionSephora
Europe• Excellent customer reception of loyalty card launched in France
in May • Partnership agreement in Russia : opening of the first store
in Moscow in December 2003 • Association in Poland, bringing total number of stores now open
there to 41
United States• Double digit comparable store sales growth in dollars• Achieved objective of Sephora US profitablity in 2003 • sephora.com extended to Canada
Total = 500 stores at end of 2003,of which 184 in France and 82 in US
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Sales 2003 Conclusion
• Solid organic growth for the year, accelerated in Q4
• Gains market share
• Continued to concentrate on strong brands, innovativeand quality products, improve profitability
• Operating Income around +7%
Objective for 2004Tangible increase in Operating Income