Tag Heuer, one of LVMH's top performing watch brands
Bulgari takeover buoys LVMH’s latest results
Posted May 03, 2011 | By Sonia Nair
LVMH’s strategic alliance with Bulgari was cited as one of the main factors that boosted its first quarter watch and jewellery sales, up 28 per cent from the same period last year.
Sales increased from €204 million ($275 million) to €261 million ($352 million) in the first quarter of 2010. The 28 per cent jump was the biggest leap recorded across all LVMH’s categories which includes wines and spirits, fashion and leather goods as well as perfume and cosmetics.
LVMH reported that its Tag Heuer, Hublot, Zenith, Chaumet, De Beers and Dior brands performed exceptionally well.
The results confirmed a recovery in demand in 2011 for watches and jewellery. Strong consumer demand in LVMH’s boutiques alongside its multi-brand retail stores were factors that contributed towards the strong results.
Italian jewellery house Bulgari Group, recently made part of LVMH in a strategic acquisition, increased its watch and jewellery sales by 21.9 per cent and 29.3 per cent respectively. Similar to LVMH, Bulgari recorded positive results in both its directly owned stores and its wholesale channels.
Revenue from LVMH watches and jewellery increased by 35 per cent in Asia, 21 per cent in Europe, 17 per cent in US and 8 per cent in Japan – despite the 11 March earthquake and tsunami.
The world’s largest luxury goods group said its teams worked hard to bring about a gradual return to normal business after the earthquake hit Japan, a key market for LVMH.
Japan represented 9 per cent of the company’s annual sales.
LVMH said in a statement, “Taking into account the geopolitical and economic environment, LVMH will continue to focus its efforts on developing its brands, will maintain a strict control over costs and will target its investments on the quality, the excellence and the innovation of its products and of their distribution.”
The group is optimistic in its outlook for the rest of 2011 and intends to expand in selected store networks.
More reading:
LVMH ramps up jewellery arm with Bulgari takeover
Bulgari's 2010 jewellery sales soar
LVMH doubles watch and jewellery profits