Louis Vuitton 2002 Annual Report Download - page 55

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IN A DIFFICULT ENVIRONMENT,
LOUIS VUITTON STRENGTHENED
ITS LEADERSHIP, WHILE THE OTHER
FASHION BRANDS CONSOLIDATED
THE FUNDAM ENTALS FOR FUTURE
GROWTH.
Net sales for the Fashion and Leather
Goods business group, including
the impact of structural changes follo-
wing the full consolidation of Donna
Karan and Fendi, were up 16%.
Income from operations improved
slightly in a difficult economic and
monetary context and was also impacted
by the consolidation of new brands
that are in the investment stage. While economic
conditions significantly affected the general
fashion and leather goods market, Louis Vuitton,
the group’s star brand and the word leader
in luxury goods, again succeeded in growing
earnings and operating margin.
Despite the drop in tourism, particularly in the
first half, and the depressed climate in certain
markets, the other brands, which are more sensi-
tive to the economic context, generally demons-
trated their capacity to respond and resist.
Donna Karan and Fendi completed restructu-
ring operations. In order to consolidate their
newer, high-end strategy, the fashion brands
of the LVMH Fashion Group have initiated a
new positioning that will offer greater resistance
to economic conditions, and will allow them
to target investments based on profitability and
to take full advantage of the economic recovery
when it occurs.
In 2003, a number of innovations and the
expansion of its retail network will continue
to drive Louis Vuitton’s growth. The business
group, whose income from operations has grown
by 57% since 1999, is well prepared to face an
uncertain environment. It continues to maintain
rigorous selectivity in its investment choices,
giving absolute priority to the generation of cash
flow and to developments that lead to profitable
growth.
The Poulbot bag from Céline, with its strong Parisian inspiration,
will be one of the hit accessories of the 2003 summer season.
PASSIONATE ABOUT CREATIVITY FASHION AND LEATHER GOODS
INVESTM ENTS
EUR million
2000 2001 2002
194 210 246
NUM BER
OF STORES
2000 2001 2002
566 765 793
ANNUAL REPORT 2002 • 53