LVMH

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LVMH Moët Hennessy .
Type Société Anonyme
Traded as EuronextMC
Industry Conglomerate (Luxury goods)
Predecessors Moët Hennessy
Louis Vuitton
Founded 1987 (1987)
Headquarters Paris, France
Area served Worldwide
Key people Bernard Arnault
(Chairman & CEO)
Antonio Belloni
(Managing director)
Products Clothing, cosmetics, fashion accessories, jewelry, perfumes, spirits, watches, wines
Services Department stores
Revenue Increase 28.10 billion (2012)[1]
Operating income Increase €5.923 billion (2012)[1]
Profit Increase €3.909 billion (2012)[1]
Total assets Increase €47.06 billion (2012)[1]
Total equity Increase €23.51 billion (2012)[1]
Employees 87,544 (2011)[1]
Parent Christian Dior (via Financière Jean Goujon)
Subsidiaries List of subsidiaries
Website LVMH.com

LVMH Moët Hennessy • Louis Vuitton S.A., better known as LVMH, is a French multinational luxury goods conglomerate, headquartered in Paris. The company was formed by the 1987 merger of fashion house Louis Vuitton with Moët Hennessy, a company formed after the 1971 merger between the champagne producer Moët & Chandon and Hennessy, the cognac manufacturer.[2][3][4] It controls around 60 subsidiaries that each manage a small number of prestigious brands. The subsidiaries are often managed independently. The oldest of the LVMH brands is wine producer Château d'Yquem, which dates its origins back to 1593.[5]

Christian Dior, the luxury goods group, is the main holding company of LVMH, owning 40.9% of its shares, and 59.01% of its voting rights.[6] Bernard Arnault, majority shareholder of Dior, is Chairman of both companies and CEO of LVMH.[7] Arnault's successful integration of various famous aspirational brands into the group has inspired other luxury companies into doing the same. Thus, the French conglomerate Kering (formerly named PPR) and the Swiss-based Richemont have also created extended portfolios of luxury brands.

Financial data[edit]

Financial data (in million euros) 2006[8] 2007[8] 2008[8] 2009[8] 2010[1] 2011 2012
Sales 15,306 16,481 17,193 17,053 20,320 23,659 28,103
Net profit 2,160 2,331 2,318 1,973 3,032 3,065 3,909
Total equity 11,594 12,528 13,887 14,785 18,204 23,512 25,666

Corporate structure[edit]

LVMH is based in 30 avenue Hoche in the 8th arrondissement, Paris, France.[2] The company is listed on the Euronext Paris exchange,[9] and is a constituent of the CAC 40 index. As of 2010, the group had revenues of €20.3 billion with a net income of just over €3 billion.[1] The group currently employs more than 83,000 people.[1] 30% of LVMH's staff work in France. LVMH operates over 2,400 stores worldwide.[10] Its current business plan aims to tightly control the brands it manages in order to maintain and heighten the perception of luxury relating to their products. For example, Louis Vuitton products are sold only through Louis Vuitton boutiques found in upmarket locations in wealthy cities or in concessions in other luxury goods shops (such as Harrods in London).

Shareholders[edit]

At the end of 2010, the only declared major shareholder in LVMH was Groupe Arnault, the family holding company of Bernard Arnault. The group's control amounted to 47.64% of LVMH's stock (with 42.36% held through Christian Dior S.A. and 5.28% held directly) and 63.66% of its voting rights (59.01% by Dior and 4.65% directly).[11] A further 2.43% of shares were declared as treasury stock, with the remainder being free float.[11] LVMH hold 66% of the drinks division, Moët Hennessy, with the remaining 34% held by Diageo[12]

Subsidiaries[edit]

A partial list including some of LVMH's most well known brands and subsidiaries:[10][13]

Make Up For Ever was established in 1984[15] and was acquired by LVMH in 1999.[16]

On March 7, 2011, LVMH announced the acquisition of the 50.4% family-owned shares of the Italian jeweller Bulgari and the intention to make a tender offer for the rest (publicly owned).[17] The transaction is about $5.2 billion.[18]

On March 7, 2013, National Business Daily reported that mid-priced clothing brand QDA will open stores with the assistance of LVMH’s private equity LCapitalAsia and the Chinese apparel company Xin Hee Co., Ltd. in Beijing.[19] In 2011, LVMH invested $640 million in establishing LCapitalAsia.[19] LVMH sales "decreased by about 10 percent from in 2011" in China and LVMH has stopped "opening stores in second and third-tier cities in mainland China".[19] Xue Shengwen, senior researcher at ChinaVenture, said that the developing trend of the market is to take advantage of more acceptable prices.[19]

In February 2014, LMVH entered into a joint venture with the Italian fashion brand Marco De Vincenzo, taking a minority 45% stake in the firm.[20][21]

Patronage[edit]

LVMH is a major patron of art in France. The group supported about ten exhibitions as "Le grand monde d’Andy Warhol"[22] and "Picasso et les maîtres"[23] at le Grand Palais in Paris. LVMH also endorsed the patronage of "l’atelier d’Alberto Giacometti" and "Yves Klein" at Centre Georges Pompidou.

In addition, LVMH foundation created the "young creators LVMH award", an international competition opened to French and international beaux-arts students.[24] Each year, six grants are allocated to the winners.

In November 2013, LVMH created the LVMH Young Fashion Designer Prize, which comes with a € 300,000 grant with a year of mentoring and is the brainchild of Delphine Arnault.[25] The first winner will be chosen in 2014.[25] In February 2014, 20 finalist for the prize were shown in London, such as Simone Rocha, Thomas Tait, Meadham Kirchhoff, Marques’ Almeida, J JS Lee, and others.[26]

LVMH underwrites other fashion competitions, including the Andam prize in France, the International Festival of Fashion and Photography in Hyères,France, an investment fund for young designers created by the French Ministry of Culture and Communication, and a scholarship program and sponsored lecture theater at Central Saint Martins in London.[25]

The group also lends Stradivarius violins to young talented musicians. Maxim Vengerov and Laurent Korcia have used the instruments.

References[edit]

  1. ^ a b c d e f g h i "Annual Report 2010". LVMH.com. Retrieved 4 February 2012. 
  2. ^ a b "LVMH Moët Hennessy Louis Vuitton SA – Company History". Funding Universe. Retrieved 30 June 2011. 
  3. ^ Rachel Sanderson in Milan (6 March 2011). "Retail & Consumer – LVMH to take controlling stake in Bulgari". FT.com. Retrieved 30 June 2011. 
  4. ^ "LVMH group, Moet Hennessy Louis Vuitton: world leader in luxury, listed on CAC 40 index.". LVMH.com. Retrieved 30 June 2011. 
  5. ^ The Beginnings of Château d'Yquem Château d'Yquem Retrieved 29 January 2010
  6. ^ http://www.dior-finance.com/en/organigramme.asp
  7. ^ "25. Bernard Arnault". CNN. Retrieved 11 May 2010. 
  8. ^ a b c d "A solid performance in a contrasting economic environment". LVMH. Retrieved 12 December 2012. 
  9. ^ "LVMH". European Equitites. Retrieved 12 December 2012. 
  10. ^ a b LVMH First half 2009 interim report LVMH Retrieved 29 January 2010
  11. ^ a b "LVMH – Reference Document 2009". LVMH. pp. 237–238. Retrieved 24 April 2010. .
  12. ^ Walsh, Dominic; Boyle, Catherine (23 April 2009). "LVMH denies being in Mot sale talks with Diageo". The Times (London). 
  13. ^ Financial Documents LVMH 2012
  14. ^ http://www.lvmh.com/the-group/lvmh-companies-and-brands/wines-spirits/wenjun
  15. ^ Wellington, Elizabeth (2013-08-01). "Mirror, Mirror: Joy! Make Up For Ever comes to King of Prussia". philly.com. Retrieved 2013-12-03. 
  16. ^ "Dany Sanz, pionnière du make-up". elle.fr. Retrieved 2013-12-03. 
  17. ^ Roberts, Andrew (7 March 2011). "LVMH Plans to Buy Bulgari for $5.2 Billion After Acquiring Majority Stake". Bloomberg. Retrieved 24 October 2011. 
  18. ^ Wendlandt, Astrid; Simpson, Ian (7 March 2011). "LVMH bags jeweller Bulgari in $5.2 billion deal". Reuters. Retrieved 24 October 2011. 
  19. ^ a b c d Kang, Xiaoxiao (March 7, 2013). "LVHM investing in Chinese mid-priced clothing market". Morning Whistle. Retrieved 2013-05-10. 
  20. ^ Astrid Wendlandt (24 February 2014). "LVMH invests in Italian brand Marco de Vincenzo". Reuters. 
  21. ^ Socha, Miles (24 February 2014). "LVMH Takes Stake in Marco de Vincenzo". WWD. Retrieved 24 February 2014. 
  22. ^ Présentation de l’expo Warhol Rmn.fr
  23. ^ LVMH, mécène de l’exposition Rmn.fr
  24. ^ Prix LVMH des jeunes créateurs Artefact Paris
  25. ^ a b c Miles Socha (21 November 2013). "LVMH to Establish Global Fashion Prize". WWM. Retrieved 21 November 2013. 
  26. ^ Socha, Miles (13 February 2014). "Delphine Arnault Unveils LVMH Prize Finalists". WWD. Retrieved 13 February 2014. 

External links[edit]