The French luxury goods group Moët Hennessy Louis Vuitton (LVMH) has left the corona crisis behind for the time being. On Thursday evening, the company announced that it had set new records for sales and earnings in the 2021 fiscal year. The comparative values from 2019, which was not yet affected by the Covid 19 pandemic, were thus significantly exceeded. The group delivered “a remarkable performance against the background of the ongoing recovery from the health crisis” last year, emphasized Chairman and CEO Bernard Arnault in a statement.
LVMH generated sales of EUR 64.2 billion in 2021, an increase of 44 percent compared to the previous year. On an organic basis, i.e. adjusted for currency effects and changes in the group structure, the growth rate was 36 percent. The contribution of the jewelers Tiffany & Co., which was taken over shortly after the beginning of the year, contributed ten percentage points to the reported increase in sales, while negative exchange rate developments pushed the growth rate down by two percentage points, the company explained. Compared to the pre-crisis year 2019, sales increased organically by 14 percent.
Sales of fashion and leather goods increased by 46 percent
All segments contributed to the upswing with double-digit growth: in by far the strongest segment, fashion and leather goods, sales were 30.9 billion euros and thus 46 percent (organically +47 percent) above the previous year’s level, sales of wine and spirits rose by 26 percent (organically +26 percent) to EUR 5.97 billion and with perfumes and cosmetics by 26 percent (organically +27 percent) to EUR 6.61 billion.
In the watches and jewelry category, sales more than doubled (+167 percent) thanks to the acquisition of Tiffany, reaching 8.96 billion euros. On an organic basis, sales there increased by 40 percent. The retail division, to which the Sephora and DFS concepts belong, was also able to recover strongly: its sales were 11.8 billion euros and thus 16 percent (organically +18 percent) above the previous year’s level. However, the ongoing travel restrictions continued to have a negative impact on the retail chain DFS, which is mainly present at airports, so that organic sales for the entire segment were 18 percent below the comparable figure for 2019.
Net profit is 68 percent above pre-crisis levels
The group was able to increase its earnings even more than sales: the operating profit adjusted for special effects was 17.2 billion euros, more than twice as high as in the previous year (+107 percent). Net income attributable to shareholders improved by 156 percent compared to 2020, reaching approximately EUR 12.0 billion. It exceeded the level of 2019 by 68 percent.
In view of the jump in profits, management intends to propose an annual dividend totaling ten euros per share at the forthcoming annual general meeting. After an interim dividend of three euros per share had already been paid out in December, the shareholders are to receive the outstanding seven euros per share at the end of April. The group management was optimistic for the current financial year, but as usual did not name any specific targets. The group of companies is again striving to “expand its global leadership position in luxury goods,” said LVMH.