LVMH Sees Big Profits, Dior Gains Despite Galliano’s Demise

LVMH Moët Hennessy Louis Vuitton has recorded significant revenue gains for the first half of 2011.

The world’s largest luxury conglomerate saw revenue of €10.3 billion ($14.9 billion) in the first half of 2011, up 13% from last year. Profits were €2.2 billion, up 22% from 2010.
Bernard Arnault, chairman and CEO of LVMH, credited strong brand appeal, consumer attraction to artisanal products and simple business strategy with prompting the growth.

“The first half was marked by the agreement with the Bulgari family to strengthen the long-term growth of the famous Italian Maison,” Arnault said in a press statement. “We approach the second half of the year … relying upon the creativity and quality of our products as well as the effectiveness of our teams to pursue further market share gains” in both historical and emerging markets.

It has been a busy six months for LVMH, which recently acquired a majority stake in Bulgari, faced opposition in buying part of Hermès, opened dozens of stores worldwide, acquired 70% of Ali Hewson’s Nude Skincare, and fought critics of its planned Frank Gehry art museum in Paris, among other projects.

Perhaps the most notable part of the company’s half-year report was the redoubled strength of Dior despite the scandal surrounding John Galliano’s exit and the poor reviews its fall-winter 2011-2012 haute couture collection received. LVMH reported “robust growth” and a gain in market share for the 65-year-old brand.

Luca Solca, a retail analyst at Sanford C. Bernstein in Zurich, had predicted that Galliano’s departure wouldn’t greatly affect its financial stability.

“Galliano designs the Dior catwalk collection, but the commercial relevance of that collection is very low,” Solca said.

In all, fashion and leather goods registered a 14% jump in organic revenue in the first half of 2011, with Céline in particular generating extraordinary demand.

Performance-wise, though, the shining star in Arnault’s crown is Louis Vuitton. It has seen double-digit organic revenue growth and a high level of profitability so far this year.

Vuitton’s first-ever participation in the Basel watch fair and the opening of a new leather goods workshop in Marsaz, France, likely aided its growth; Arnault has also said Vuitton is aided by the fact that it is the only luxury brand to sell exclusively within its own store network.

All told, the biggest gains for LVMH came in the watches and jewelry group, which saw a 27% jump in revenue over last year. TAG Heuer (with a new automatic chronograph made with the 1887 Calibre movement and the opening of TAG Heuer stores), Hublot (the King Power line with new Unico movements) and Dior (launch of the Dior VIII watch) saw large jumps in sales.

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New artistic directors at Kenzo

LVMH on Tuesday announced the appointment of Humberto Leon and Carol Lim as artistic directors of the ready-to-wear label Kenzo with immediate effect.
They replace Sardinian designer Antonio Marras, who has held the post for eight years and who shows his own name label in Milan,
“After eight successful years, LVMH and Antonio Marras have decided to end their collaboration,” LVMH said in a statement, without giving details.

“Humberto Leon and Carol Lim will bring to Kenzo the freshness of their creative talent to give a new boost to this emblematic house.
I am sure they will succeed in positioning the brand on the road to an ambitious development,” Pierre-Yves Roussel, chief executive of the fashion division of LVMH, said.
The appointments follow the arrival in January of a new chief executive, Eric Marechalle, at the helm of Kenzo.

It has been seen as an indication by analysts of LVMH chief Bernard Arnault’s desire to revitalise the label amid persistent rumours that it was going to be sold.
Leon and Lim, both 36, made their name with Opening Ceremony, the fashion concept and New York based multi-label boutiques they founded in 2002.
They will now share their time between New York and Paris.
Kenzo was created in 1970 by the Japanese designer Kenzo Takada, who sold the house in 1993 to LVMH and retired in 1999. It has around 100 boutiques worldwide.

source:Luxuo

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World’s Most Valuable Luxury Brands

Louis Vuitton is the world’s most valuable luxury brand for the sixth consecutive year according to Millward Brown Optimor’s 2011 BrandZ study.The brand, owned by Paris-based LVMH Moet Hennessy Louis Vuitton, has a value of $24.3 billion, an increase of 23 percent from 2010.

That’s almost as much as the combined values of Hermes, Gucci and Chanel, which ranked second, third and fourth in this year’s luxury-brand standings.
Hermes, in which LVMH holds a 20.2 percent stake, posted the biggest increase in brand value in the luxury industry with a 41 percent jump to $11.9 billion.

Gucci’s value declined 2 percent to $7.45 billion, affected by French parent PPR’s financial performance. Chanel advanced 23 percent to $6.82 billion.

Hennessy, Moet & Chandon and Fendi placed seventh, eighth and ninth in the study, respectively, with values of $3.42 billion to $5 billion, meaning LVMH owns or has a stake in five of the industry’s 10 most-valuable brands.

The Cartier and Rolex brands ranked fifth and sixth in the luxury-brand ranking, while Burberry replaced Tiffany as No. 10.

source:Luxuo

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Edun’s Bono and Ali Hewson in Louis Vuitton Ad Campaign

Bono and and his wife Ali Hewson star in the newest of Louis Vuitton’s “core values” ads shot by Annie Leibovitz.
The couple, who were shot in South Africa, wear clothing by Edun, Hewson’s sustainable fashion line. in which LVMH took a 49 percent stake last year.
it’s the first time the U2 front man has appeared in an ad without his band, and the first time a label other than Vuitton is getting a fashion credit.

Antoine Arnault, Vuitton’s director of communications, explained that Edun’s presence in a LV campaign would give the small brand major international exposure.
Ali Hewson carries a new handbag that was a join project between Edun and LV and has a special charm that is the French firm’s first made-in-Africa product.
The ad — which reads “Every Journey Begins in Africa” — features the humanitarian duo arriving in an African grassland.
The ad coincides with Paris Fashion Week’s Africa Rising Exhibition, where contemporary African art will be sold alongside Edun’s Spring collection.
Both Bono and Hewson donated their appearance fee to charity organizations that promote growth in developing countries.
A portion of the profits from their new co-designed LV bag will also go to charity.
Via WWD - Popcrunch