LVMH Net Profit Jumps 156% in 2021, Boosted by Strong Q4
PARIS — LVMH Moët Hennessy Louis Vuitton said net profit soared 156 percent year-over-year in 2021, as a better-than-expected fourth quarter confirmed strong demand for its luxury products, fueled by the key fashion and leather goods division.
The luxury conglomerate, which owns 75 brands including Louis Vuitton, Dior, Tiffany & Co. and Sephora, said net profit totaled 12 billion euros last year, up 68 percent compared to 2019, beating a FactSet consensus estimate of 10.9 billion euros.
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Profit from recurring operations stood at 17.1 billion euros, up 49 percent versus 2019, which is considered a more reliable benchmark due to the disruptions caused by the coronavirus pandemic in 2020.
Fashion and leather goods posted organic growth of 51 percent in the fourth quarter, compared with 2019, marking a sharp acceleration versus previous quarters and reflecting the strength of marquee brands Louis Vuitton and Dior, as well as a record year for Celine and Fendi. The division generated profit from recurring operations of 12.8 billion euros, up 75 percent compared with 2019.
In the watches and jewelry division, LVMH flagged a “record” performance by Tiffany, after completing its $15.8 billion purchase of the U.S. jeweler a year ago.
“The performance for the year confirms a return to strong growth momentum following the severe disruption to the first half of 2020 resulting from the global pandemic,” the company said in a statement. “Within the context of a gradual recovery from the health crisis, LVMH is confident in its ability to maintain its current growth momentum.”
Bernard Arnault, chairman and chief executive officer of LVMH, paid tribute to Virgil Abloh, the artistic director of men’s collections at Vuitton, who died in November at the age of 41 from a rare form of cancer.
“His immense visionary talent and his great wisdom will forever be embedded within the history of our group,” Arnault said in a statement. Abloh’s last collection for Vuitton was unveiled in Paris last week at two shows attended by members of the Arnault family and Abloh’s wife Shannon, alongside celebrities including J Balvin, Victor Cruz, Naomi Campbell, Venus Williams and Tyler the Creator.
Vuitton chairman and CEO Michael Burke told WWD the brand was in no rush to name Abloh’s successor. “It needs to be given the right amount of time. It cannot be done under pressure,” he said.
LVMH’s fourth-quarter revenues totaled 20 billion euros, up 22 percent in organic terms versus 2019, topping analysts’ expectations. The strong results come after Compagnie Financière Richemont reported that revenues in the three months to Dec. 31 jumped 38 percent at constant currency rates versus the same period two years earlier. Kering is due to publish annual results on Feb. 17.
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Louis Vuitton CEO Talks Final Virgil Abloh Collection, Succession Plans
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Richemont Reports Strong Performance in Q3, Europe Included
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