Bernard Arnault, CEO of LVMH, highlighted the continued strong demand for high-end products, especially haute couture from brands like Christian Dior. Despite a general downturn in consumer spending, luxury brands like LVMH and Richemont, owner of Cartier, have maintained robust performance. In contrast, competitors with lower price points, like Burberry, have faced challenges.
Arnault expressed confidence in LVMH's growth trajectory for 2024. The company's diverse product range includes items like the $11,500 Lady Dior bag and Dom Perignon P3 Plenitude Brut Rose champagne priced at $5,377.
Jean-Jacques Guiony, CFO of LVMH, noted significant growth from Chinese customers in Europe, with Louis Vuitton sales reaching 70% of the pre-pandemic levels of 2019. He anticipates continued growth despite not expecting a rapid return of Chinese tourist groups to Europe.
The luxury sector, seen as a bellwether for the wider industry, has experienced a slowdown after a post-pandemic surge. Analysts at Bernstein, Citi, and Barclays predict a more moderated growth for high-end luxury companies, with industry-wide growth expected at 5% this year. The return of Chinese tourists is partly offsetting subdued spending by American and European consumers.
LVMH's fashion and leather goods division, which includes flagship brands Vuitton and Dior, saw a 9% increase in sales, slightly below the expected 10%. The group proposed a dividend increase to 13 euros per share, up from 12 euros, and anticipates continued growth despite uncertain economic and geopolitical conditions.
Regarding competitor Richemont, Arnault jokingly offered assistance in maintaining its independence. LVMH also announced the nomination of Alexandre and Frederic Arnault, Arnault's sons, and French businessman Henri de Castries to its board of directors at the April 18 annual meeting and Arnault confirmed his intention to remain at the helm of LVMH for the foreseeable future.