The French luxury group kept vacuuming up market share last year, with Louis Vuitton and Dior leading the charge. Sales in its fashion division leapt 51 percent over pre-pandemic levels in Q4.
LVMH chairman Bernard Arnault arrives at Dior’s haute couture show with his son Frédéric and the brand’s CEO Pietro Beccari.(Getty Images)
LVMH closed 2021 with sales that grew 14 percent compared to 2019′s pre-pandemic levels, far faster than the broader luxury market. Profits more than doubled from 2020.
Some units and regions that had bounced back more slowly, like Sephora and Europe, show signs of turning a corner.
Growth is still being driven mainly by the group’s biggest and most profitable fashion labels, Dior and Vuitton. Tiffany, too, posted record sales and profits.
In a year when global luxury sales grew fast, LVMH’s brands grew faster.
The owner of Louis Vuitton, Dior and many other labels reported 2021 revenues that rose 36 percent year-on-year to €64.2 billion ($71 billion), growing 14 percent over 2019′s pre-pandemic levels. Profits more than doubled year-on-year to €17.15 billion, the company said Thursday.
Growth at the French luxury conglomerate continues to be driven by its biggest and most recognisable brands, Louis Vuitton and Dior, which have been rapidly increasing their share of the fashion market since the pandemic. LVMH’s fashion and leather goods division reported sales that grew 42 percent versus 2019, accelerating in the fourth quarter to grow by 51 percent by that measure.
Tiffany & Co., which LVMH acquired in January 2021, also posted a record year in terms of both sales and profits, LVMH said, despite the closure for renovation of its iconic New York flagship, which is set to reopen later this year.
LVMH grew more than three times faster in 2021 than the personal luxury goods market overall, which is expected to have risen by four percent over 2019 levels (adjusting for currency swings), according to estimates from consultancy Bain. In his annual speech to analysts and investors, chairman Bernard Arnault said the strong revenue growth was continuing so far this year.
“January’s sales reconfirm growth at the same rhythm as at the end of last year,” he said.
In addition to the record-breaking numbers at LVMH’s strongest units, Arnault had more to say than usual about some the group’s businesses that have faced a rockier road since the pandemic.
Celine, which had seen historic clients exit following an abrupt repositioning by Hedi Slimane in 2018 and 2019, may finally be taking off. LVMH had previously flagged that the brand returned to growth in the first half of 2021. Now Arnault says “it’s one of the fastest-growing fashion brands in the world.”
Whether those results are meetings targets, considering the intense level of investment LVMH has put in the brand since Slimane’s arrival, is less clear. In any case, Arnault’s bullish tone for the unit could suggest LVMH would favour leaning into the current inflection at the unit rather than pulling back. He said Slimane was “stuffed with talent.”
Beauty retailing giant Sephora’s sales are back above 2019 levels, LVMH said, thanks mainly to strength in its e-commerce operations. That unit, too, had faced an uphill climb since the pandemic, as it relies on retail foot-traffic in districts that have been calmed by telework and the lack of tourism. (Sales tactics that involve sharing testers with other clients and being touched by sales associates weren’t Covid-friendly either.)
LVMH’s retail unit owning Sephora, DFS, and Paris’ Le Bon Marché and Samaritaine department stores was nonetheless the group’s worst-performing, with sales still down 18 percent versus 2019.
Perfume and beauty sales were still down slightly, which LVMH attributed (as in recent quarters) to its choice not to redirect inventory to the grey market to make up for a drop in wholesale orders.
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