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BUSINESS REVIEW
LVMH 2011

ANNUAL REPORT

Table of contents

  • Page 1
    LVMH 2011 - ANNUAL REPORT BUSINESS REVIEW

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  • Page 3
    ... and great names that are synonymous with the history of luxury. A natural alliance between art and craftsmanship, dominated by creativity, virtuosity and quality. A remarkable economic success story with nearly 98,000 employees worldwide and global leadership in the manufacture and distribution of...

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  • Page 5
    ... numerous new positions for craftsmen and craftswomen at our workshops in France and elsewhere in Europe. As we keep a close watch on the current economic volatility in Europe, LVMH will remain true to its values, managing the Group's businesses with a steady hand and continuing to invest wisely...

  • Page 6
    ... most suitable brand. But the Group also attracts the best managers; we offer them a unique environment and unequalled career development prospects. Attracting, incubating and nurturing the most promising talent are strategic priorities for all our businesses. DEDICATING THE RESOURCES REQUIRED TO...

  • Page 7
    ... Group allows us to constantly explore an ever-changing world, identify new and promising concepts, as well as the best opportunities in the market, make quick decisions, find the right teams and allocate the necessary financial resources to invest in new regions and build solid market positions...

  • Page 8
    LVMH 2011 - Financial highlights 2011 : ANOTHER GREAT VINTAGE FOR LVMH REVENUE (EUR millions) 2011 2010 2009 23,659 20,320 17,053 REVENUE BY BUSINESS GROUP (EUR millions) Wines and Spirits Fashion and Leather Goods Perfumes and Cosmetics Watches and Jewelry Selective Retailing Other activities ...

  • Page 9
    LVMH 2011 - Financial highlights STORE NETWORK (at December 31, 2011) NUMBER OF STORES 2011 United States 621 stores Europe (excl. France) 883 stores 2010 2009 3,040 2,545 2,423 France 390 stores Japan 360 stores Asia (excl. Japan) 621 stores Other markets 165 stores REVENUE BY GEOGRAPHIC ...

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    08 / 68

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    ...difficult times. Significant synergies are unlocked when we develop our store networks, expand into new markets, share research and distribution resources, and also in support functions such as media buying. Finally, LVMH offers a whole range of career development opportunities. The LVMH "ecosystem...

  • Page 12
    ...majority of whom are independent) appointed by the Board of Directors. The Committee met three times in 2011. It issued recommendations on the compensation of the Chairman and Chief Executive Officer and Group Managing Director and on their bonus-share award, and gave its opinion on the compensation...

  • Page 13
    ... Arnault Chairman and Chief Executive Officer Antonio Belloni Group Managing Director Pierre Godé Vice-Chairman Vice-Chairman Antonio Belloni Group Managing Director Nicolas Bazire Development and Acquisitions Ed Brennan Travel retail Yves Carcelle Fashion and Leather Goods Antoine Arnault...

  • Page 14
    ... wines from the world's most famous wine-growing regions. The Group is also the world leader in cognac with Hennessy and is expanding its presence in the luxury spirits segment in addition to its historical business. The portfolio of brands is served by a powerful international distribution network.

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  • Page 16
    LVMH 2011 - Wines & Spirits

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    ... Champagne exports increased, particularly to the United States and emerging markets. Cognac had a record year with outstanding sales in Asia, a region where consumers have a particular appreciation for high quality. But beyond the general trend, our own brands REVENUE (EUR millions) 2011 2010 2009...

  • Page 18
    ... scope and Hennessy cognac sales were up 6%. A stronger product mix and a firm policy of premium pricing also contributed to these excellent results. MOËT & CHANDON reaffirmed its momentum and consolidated its leading position in the world of champagne. The brand successfully rolled out Moët Ice...

  • Page 19
    ... 10% organic revenue growth in 2011. The business group's profit from recurring operations rose 18%. RUINART, whose main strategic focus is to expand its range of prestige cuvée champagnes, increased sales substantially, particularly in Western Europe and the United States. The year-end also saw...

  • Page 20
    ... the world's best-selling cognac, in terms of both volume and value. Asia is the main growth region, with all of the brand's cognacs boasting double-digit revenue growth, notably in China and Vietnam. In the United States, high sales volume was maintained in a still sluggish economic environment and...

  • Page 21
    ... controlled, strategic priorities will be to innovate, enhance brand appeal and strengthen the distribution network. The excellence of Wines and Spirits' products together with the ambition and experience of its people will enable the business group to continue to grow profitably and strengthen LVMH...

  • Page 22
    ... would use it to build his family home. In 1907, the company bought back the property to turn it into a "maison d'hôte". Since that time, the Hôtel du Marc has embodied the French "Art de Vivre," which is so important to the Champagne Maison. A new milestone in this history came in 2011, the year...

  • Page 23
    ... Maison decided to share a secular treasure from its rarest reserves for charity. A total of 11 elegant leather cases with six numbered limited-edition bottles of the 1911 Grand Vintage Collection, have been or will be sold at 11 auctions in 11 major cities throughout the world. Proceeds from each...

  • Page 24
    LVMH 2011 FASHION & LEATHER GOODS Louis Vuitton, Fendi, Donna Karan, Loewe, Marc Jacobs, Céline, Kenzo, Givenchy, Thomas Pink, Pucci, Berluti, Rossimoda and Nowness are the brands that form the Fashion and Leather Goods business group. This outstanding group of brands from both sides of the ...

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  • Page 26
    LVMH 2011 - Fashion & Leather Goods

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    ... range of trimmings, twenty-six colors, two linings and a vast array of metal finishes. For men, on whom Louis Vuitton increasingly wants to focus, we have created a made-to-order footwear and belt service as well as a collection of evening ready-to-wear that can be personalized. In leather goods...

  • Page 28
    ... that the brand's values mirror their own. Louis Vuitton is also attracting growing numbers of new customers from Asia and South America, further contributing to the brand's phenomenal development. In 2011, growth was particularly remarkable in Europe, the United States and Asia. Business activity...

  • Page 29
    ... of the brand's strategy. The brand's new high-end leather goods special-order line is also a fine illustration of this strategy, giving customers a cornucopia of alternatives to choose from to experience the thrill of owning a truly unique design. In 2011, the brand further increased its use of...

  • Page 30
    ... in North and South America will strengthen the control over one of its emblematic businesses, opening up new development opportunities. MARC JACOBS enjoyed rapid growth in 2011, spurred by strong results across all geographic regions. A ten-time winner at the annual "Council of Fashion Designers of...

  • Page 31
    ...potential. Growth was strong across all of the brand's markets, with China in the lead. Store renovations are continuing, using the concept developed by the architect Peter Marino. CÉLINE performed remarkably well in 2011, attaining recordsetting revenue and profit levels. Driven by the success of...

  • Page 32
    LVMH 2011 - Fashion & Leather Goods KENZO focused on its repositioning around the brand's original values, now the responsibility of the new creative team of Humberto Leon and Carol Lim. GIVENCHY continued its progress during the year, with all of its lines making strong advances. Women's ready-to...

  • Page 33
    LVMH 2011 - Fashion & Leather Goods - Outlook Louis Vuitton will continue on the path of innovation in 2012, accentuating its high-end image, reinforcing the presence of leather in its collections, and introducing many personalization options. The brand will also be expanding its presence to new ...

  • Page 34
    LVMH 2011 - Fashion & Leather Goods FOCUS The Louis Vuitton Island Never has the title "ï¬,agship" been more appropriate than for the new Louis Vuitton's Maison based in Singapore's Marina Bay. "The Island" , Louis Vuitton's new store in South East Asia, brings back to life the spirit of sea ...

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    LVMH 2011 - Fashion & Leather Goods FOCUS 33 / 68

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    LVMH 2011 - Fashion & Leather Goods FOCUS Berluti unveils its first ready-to-wear collection Berluti, bootmakers since 1895, has attracted much attention by entrusting the creation of a men's ready-to-wear collection to Alessandro Sartori, the Maison's Artistic Director. True to Berluti's ...

  • Page 37
    ... to design works using scraps of raw materials. Customers have thus been able to discover and admire the brand's know-how through these works, which are displayed in stores. This initiative illustrates the close links between Fendi and the art world. Loewe: Masters of Leather In September 2011...

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    LVMH 2011 PERFUMES & COSMETICS LVMH, a major player in the perfumes, make-up and skincare sector, relies primarily on a portfolio of brands representing French companies with an international presence: Christian Dior, Guerlain, Givenchy and Kenzo. The Group also supports the development of high-...

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  • Page 40
    LVMH 2011 - Perfumes & Cosmetics

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    ... the business group's brands. Many of the products (such as Capture, Nude or Prestige by Dior, and Orchidée Impériale by Guerlain) that are hailed by the international beauty press every year - and by the brands' customers - are the result of work carried out at the LVMH Research facility. Helios...

  • Page 42
    ... a mixed business environment toward the end of the year, Europe also made a positive contribution to growth. PARFUMS CHRISTIAN DIOR confirmed its strong momentum in 2011, in a highly competitive global market. The brand promoted its values of excellence and creativity through investments in major...

  • Page 43
    ... markets, and in particular on Asia and France, where it continues to increase market share. Shalimar has strengthened its line with a new addition and consolidated its market positions, joining the select group of France's top-five selling perfumes. Skincare revenue was strong once again in 2011...

  • Page 44
    ... is pursuing its global expansion. BENEFIT's original market positioning once again enabled the brand to enjoy double-digit revenue growth and an excellent profit margin. Two of the year's most successful innovations were They're Real mascara and the b.right skincare line. Benefit has consolidated...

  • Page 45
    ... lines, HD and Aqua, continue to grow strongly. The brand opened two boutiques in Los Angeles and Paris. PARFUMS LOEWE has been holding up well in its home country and is pursuing its international expansion. FRESH is expanding its distribution network in Asia. ACQUA DI PARMA has launched a new...

  • Page 46
    LVMH 2011 - Perfumes & Cosmetics FOCUS La Collection Privée Christian Dior "You can't imagine how much know-how and precision it takes to create a fragrance. The creative process is so consuming, so demanding, that I feel as much a Perfumer as a Couturier." Christian Dior 1947: with his first ...

  • Page 47
    ... Europe to Asia, three centers of expertise make up this exceptional platform: the experimental garden in Geneva, Switzerland, the main laboratory in Strasbourg, France, and the exploratory reserve in Tianzi, China. In Tianzi, Guerlain is involved in a sustainable development patronage initiative...

  • Page 48
    ... of the select group of true Swiss Manufactures, the development and transition to high-end products of Dior timepieces and the creativity and productivity of the jewelry collections from Chaumet, Fred and De Beers. In 2011, the business was expanded with the talent as well as the international and...

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  • Page 50
    LVMH 2011 - Watches & Jewelry

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    .... TAG Heuer, Hublot and Bulgari will therefore be stepping up production of their own calibers. - You also invest in distribution. Expanding our store network is another key priority. We are broadening our presence selectively by targeting growth markets. In addition to opening new stores, we...

  • Page 52
    ...the Mikrotimer Flying 1000, entirely developed and manufactured in its own workshops. The brand continues to expand its retail network and now has nearly 130 stores worldwide (owned and franchised). In addition, TAG Heuer is working to further industrialize its processes, as evidenced by the Calibre...

  • Page 53
    .... The full renewal of its collections is now complete, structured around the brand's five iconic lines. Zenith has seen strong growth in Asia and the selective expansion of its retail network continues in high-potential markets, most notably with the opening of two new boutiques in Hong Kong and...

  • Page 54
    ... points. Store expansion and redesign projects are helping to reinforce the retail network's high-end image. At CHAUMET, new jewelry watch creations were introduced in the Bee My Love and Attrape-moi si tu m'aimes collections. Following the opening of boutiques in Beijing and Shanghai some time ago...

  • Page 55
    ...strong business growth in its various markets, especially in Asia with the successful opening in Beijing of its first store in China. FRED continues its targeted growth in France and Japan, with its main efforts focused in particular on its iconic Force 10 and Success lines. Celebrating 75 years of...

  • Page 56
    ... boost its development on a global scale and create considerable synergies, especially in purchasing and distribution. With Bulgari, LVMH brands will be able to invest and innovate even more. LVMH will thus be in a position to become world leader on the very high-end watches and jewelry market. 54...

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    LVMH 2011 - Watches & Jewelry FOCUS 55 / 68

  • Page 58
    ... The LVMH Selective Retailing companies operate in Europe, North America, Asia and the Middle East. Their businesses are conducted in two segments: retailing designed for customers who are international travelers ("travel retail"), the business of DFS and Miami Cruiseline, leaders in their markets...

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  • Page 60
    LVMH 2011 - Selective Retailing

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    ...for developing DFS in the years ahead. Miami Cruiseline, the premier onboard store retailer offering luxury products, is sharpening its competitive edge by tailoring its sales and marketing model to the company or destination in question. New customers from Europe and Latin America are future growth...

  • Page 62
    ...with larger shops. Increased spending per passenger has also contributed to this excellent performance. As a new global clientele from Europe and Latin America emerges, Miami Cruiseline is reaping the benefits of its efforts to adapt its marketing strategy and products to the specific requirements...

  • Page 63
    ... in 2011, gaining market share in all regions. The only global specialist retailer in perfume and cosmetics, Sephora continued to offer shoppers a unique experience of innovative products and exclusive services and actively developed its customer loyalty programs in all regions. At the end of 2011...

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    LVMH 2011 - Selective Retailing The chain pursued its expansion in the Middle East and Southeast Asia, with two new stores in Kuala Lumpur, Malaysia. Sephora also opened its first two stores in Mexico. Online sales continued to grow strongly in France, the United States, Brazil and China. LE BON...

  • Page 65
    ... expand into new regions, such as Scandinavia, and will extend its presence in South America, most notably by opening new stores in Brazil. Sephora will develop its customer-oriented strategy and focus on providing innovative new products and services. Le Bon Marché, the world's first department...

  • Page 66
    ... such as a selection of the team's favorite products, the possibility of scanning products to read client reviews, and even an interactive tool to test nail polish colors. The application enjoyed huge success, with over 1.4 million downloads. A mobile site is also available to all smart phones...

  • Page 67
    ...enable certain brands to offer very personalized service with expert advice, demonstrations and "makeovers." The BeautyLab - a specialized concept offering the latest innovations in cosmeceutical products, anti-aging skin care and organic cosmetics - features exclusive new brands. Digital technology...

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    ..., Pierre Mandreau, Hublot / Christophe Henry, Guido Mocafico, Gabriel De La Chapelle, Hudson Cuneo, picture libraries of LVMH and Group's Maisons. LVMH - 22, avenue Montaigne - 75008 Paris - France Tel.: 33 (0)1 44 13 22 22 - Fax: 33 (0)1 44 13 22 23 - www.lvmh.com 68 Design and production:

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    LVMH 2011 - ANNUAL REPORT MAISONS

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    ... 30 WINES & SPIRITS FASHION & LEATHER GOODS PERFUMES & COSMETICS WATCHES & JEWELRY SELECTIVE RETAILING OTHER ACTIVITIES - History of the Group Although the history of the LVMH Group began in 1987 with the merger of Moët Hennessy and Louis Vuitton, the roots of the Group actually stretch back much...

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    LVMH 2011 - Heritage WINES FOCUS & SPIRITS 02 / 32

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    ... Maisons of the LVMH Group opened the doors of their most emblematic heritage sites to the public in October 2011: workshops, cellars, mansion houses, family homes, historical boutiques, etc. The Journées Particulières are primarily a celebration of the LVMH Group's countless trades and crafts and...

  • Page 78
    ... relationship with the world of art for many years. Today, it participates in a number of international events, including ARCO, Art Basel, Carré Rive Gauche, London Design and Miami Art Basel, and enjoys collaboration with the greatest names in contemporary design. The infinite care and attention...

  • Page 79
    ...been serving in the French forces, founded a brandy trading business in Cognac. His son James rapidly expanded the company and the history of cognac has been written with Hennessy ever since. Today, Hennessy is the uncontested leader in cognac, selling 60 million bottles a year around the world. Its...

  • Page 80
    ... is one of the great names in the world of malt whisky and known as the industry pioneer. In the 1980s the company embarked on an international marketing campaign, stressing the premium quality and handcrafted character of Glenmorangie and helping to develop the world's taste for single malt. Its...

  • Page 81
    ... in 1668, his mission was "to make the best wine in the world". This lofty ambition revealed a visionary spirit in this young monk just 30 years old. An exact contemporary of Louis XIV, Pierre Pérignon transformed the history of wine, just as the Sun King revolutionized the "art of living". The...

  • Page 82
    ... Wines collection. Founded in 1973 by Moët & Chandon in Yountville, in the heart of the Napa Valley, a region that has become one of the world's leading winegrowing regions, Domaine Chandon California is the first vineyard established in the United States by a French Champagne company. Originating...

  • Page 83
    ...'s South Island. Its reputation and quality helped put New Zealand wines on the global wine map, earning them international prestige. The Cloudy Bay estate benefits from a relatively cool and moderate maritime climate year round, producing one of the world's most refined Sauvignon Blanc wines...

  • Page 84
    .... The product line is available in Numanthia, Termes and Termanthia. Numanthia is part of the Estates & Wines collection. BELVEDERE - Since 1993 - NUMANTHIA - Since 1998 - It is only fitting that the world's first super premium vodka should hail from Poland, the home of vodka. In the small town...

  • Page 85
    ... Recognized as one of the world's best wineries by the international press, Terrazas de los Andes has in just a few years become a leading brand in the super-premium Argentine wine segment. Its wines are exported to 40 countries. It was quite natural that Terrazas de los Andes was selected by Cheval...

  • Page 86
    ... the story of Louis Vuitton. Always at the leading edge of fashion without compromising traditional craftsmanship, Louis Vuitton now works in other creative spheres: ready-to-wear, shoes, accessories, watches and jewelry. Under the artistic direction of Marc Jacobs, success and recognition have...

  • Page 87
    ... the birth of women's and men's ready-to-wear clothing, shoes, watches, perfumes, eyeglasses, ties, scarves and home furnishings. Fendi has been part of the LVMH Group since 2000. Its products are now distributed in over 35 countries around the world through a network of Fendi owned stores and in...

  • Page 88
    LVMH 2011 - Maisons FASHION & LEATHER GOODS ROSSIMODA - Since 1942 - CÉLINE - Since 1945 - EMILIO PUCCI - Since 1947 - Rossimoda, an Italian company founded in 1942, which joined the LVMH Group in 2003, specializes in the manufacturing and distribution of licensed luxury women's footwear. The...

  • Page 89
    ... a member of the LVMH Group in 1988. In 1995, Hubert de Givenchy retired after forty-three years of fashion design. Today, Givenchy is an international luxury brand, known worldwide for its Haute Couture collections, ready-to-wear fashions for men and women and accessories. Born of the tradition of...

  • Page 90
    ...the company now offers two lines of ready-towear, bags, shoes and accessories for men and women: Marc Jacobs and Marc by Marc Jacobs, as well as a Children's line and Marc Jacobs perfumes. The New York fashion shows for both lines are events each season. While the brand now enjoys very steady growth...

  • Page 91
    LVMH 2011 - Maisons FASHION & LEATHER GOODS THOMAS PINK - Since 1984 - EDUN - Since 2005 - Thomas Pink is a leading British company, known for the design, manufacture and distribution of high-end shirts, ties and accessories for men and women. Pink has brought back a taste for a tradition, ...

  • Page 92
    ..., opened in the exclusive setting of the Yacht Club Costa Smeralda in Porto Cervo. Acqua di Parma has its head offices in Milan. All of its ranges are produced exclusively in Italy and distributed in 37 countries in Europe, Asia and U.S. Since 2001 Acqua di Parma has been part of the LVMH Group. 18...

  • Page 93
    ..., Creative Director of Dior make-up, perpetuate this heritage. Parfums Christian Dior was created in 1947, the same year as the fashion house, with the introduction of the Miss Dior perfume. While developing its lines of fragrances for men and women over the years, Parfums Christian Dior expanded...

  • Page 94
    ... which offers a "girls club" environment where customers indulge in legendary Benefit brow and beauty services. Benefit products are available at select retail counters, online, by mail and in more than 2,000 points of sale in 29 countries worldwide. Benefit Cosmetics joined LVMH in 1999. MAKE UP...

  • Page 95
    ...creating her own make-up academy with the opening of a center in Paris that trains the make-up artists of tomorrow. Now, the company's mission is to share the art and passion of make-up with artists and customers. Some of the product lines have become best sellers, like the HD foundation or the long...

  • Page 96
    ... famous Italian luxury leather goods and ready-to-wear brand was founded in Rome in 1925, and built its reputation using the most luxurious leathers and furs. Following the success of its ready-towear clothing men and women, shoes, watches, eyewear, ties, scarves and home furnishings, Fendi launched...

  • Page 97
    ... of garçon fashion and Art Deco, jewelry became more geometric and Marcel Chaumet succeeded his father. In the post-war years, Chaumet became a trend setter, embodying Parisian taste and creativity. Chaumet has been part of the LVMH Group since 1999. The Maison is international with more than...

  • Page 98
    ... his timepieces. He developed designs for interchangeable parts and an automated manufacturing process to support the careful craftsmanship that went into creating and finishing each watch. Still today, the Manufacture is in a constant state of renewal as the site is currently under renovation. The...

  • Page 99
    ...the movie world. With the growth of its international reputation, Bulgari began its first phase of global expansion in the 1970s, opening stores in New York, Geneva, Monte Carlo and Paris. In 1977 Bulgari launched the BVLGARI BVLGARI watch, a worldwide success story, considered an all-time classic...

  • Page 100
    .... For the watch brand, rubber is not a fashion phenomenon, but represents its philosophy, its brand image since the first day. Since 2004, when Jean-Claude Biver assumed the role of Hublot Chief Executive Officer, the "Art of Fusion" has become a way of thought and design at Hublot: combining...

  • Page 101
    ...in Paris and St-Tropez, then in Geneva, Moscow, Dubai, Cannes, Budapest, Kuala Lumpur, Shanghai, Warsaw, Hong Kong, New York, Beverly Hills, Ginza, Courchevel, Gstaad. The success of this timepiece has driven a tenfold increase in revenue in four years! Hublot, founded in 1980, joined the LVMH group...

  • Page 102
    ...only Parisian department store with a genuine cultural dimension. It enjoys a reputation as the French capital's most exclusive store thanks to the quality of the products and a unique range of customer services. The sole department store located on the left bank in Paris, it was acquired by LVMH in...

  • Page 103
    ... currently operates more than one thousand stores in some twenty countries worldwide where customers enjoy the freedom to choose from a broad range of products at their leisure. Since its acquisition by LVMH in July 1997, Sephora has undergone rapid international expansion. The company's distinctive...

  • Page 104
    .... Founded in 1870 by Ernest Cognacq and his wife Louise Jay, who had been the head sales clerk in ready-to-wear clothing at Le Bon Marché, La Samaritaine evokes the Paris of the Second Empire, modernized by Baron Haussmann, at a time when the first department stores began to appear. Set prices...

  • Page 105
    ...LVMH became shareholder of the Les Echos Group, confirming its desire to adapt to a constantly changing print-media market. Today Groupe Les Echos is the leading economic and financial press group, with some twenty print and online publications. It also covers the arts, culture and business services...

  • Page 106
    ... Katz, Collection Louis Vuitton / Laurent Bremaud LB Production, Mirco Braccini, Willy Vanderperre, Fabien Sarazin, Eric T. White, LVMH / Christophe Beauregard, Sanaa, studio Cyrille Thomas, picture libraries of LVMH and Group's Maisons. LVMH - 22, avenue Montaigne - 75008 Paris - France Tel.: 33...

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  • Page 109
    LVMH 2011 - ANNUAL REPORT SUSTAINABLE DEVELOPMENT

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    ... A COMMUNITY OF MEN AND WOMEN DRIVEN BY SHARED VALUES PROTECTING THE ENVIRONMENT CORPORATE SPONSORSHIP TO SUPPORT CULTURE, YOUTH AND HUMANITARIAN ACTION Excellence of products and service Because we embody what is most noble and accomplished in the artisan world. Brand image enhancement Because they...

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    ... luxury businesses by the values of creativity and excellence. To apply our creative passion to a genuine art de vivre to which our customers aspire. To strengthen our position as a global leader, and to be the benchmark in the management and development of high quality brands. ENVIRONMENT To work...

  • Page 114
    LVMH 2011 - Talent A COMMUNITY OF MEN AND WOMEN DRIVEN BY SHARED VALUES The LVMH "ecosystem" is made up of people whose broad range of professions and geographical locations contributes to the success of the Group's Maisons, set against a backdrop of ambitious goals and the desire for sustainable...

  • Page 115
    ...HUMAN RESOURCES MANAGERS LVMH places considerable importance on investing in human capital and, accordingly, the Group has a dense and broad network of employees responsible for Human Resources. Every business line, Maison and subsidiary in every country in which the Group operates has its own Human...

  • Page 116
    ... STAFF TRAINING AND DEVELOPMENT In 2011 the Group made an even greater commitment to management training, especially in leadership development. New online training programs broadened the reach of this investment and helped increase the amount of management training offered regionally. The year also...

  • Page 117
    ... of Europe (excl. France) United States Japan Rest of Asia (excl. Japan) Other markets 31% 6 9% 25% 75% 23% 2 2% 77% 78% 25% 75% 3 4% 6 6% BREAKDOWN OF WOMEN/MEN BY BUSINESS GROUP (regular employees) Wines & Spirits 6 4% 36% 28% Fashion & Leather Goods 7 2% Perfumes & Cosmetics Watches...

  • Page 118
    ... our in-house talent (career development, training, multiculturalism, and so on), external and finely targeted recruitment of new talent is a strategic pillar of our Human Resources policy. - the "LVMH Rendezvous" give selected students an introduction to the world of luxury brand marketing as well...

  • Page 119
    ... recruitment code of conduct. This program was deployed in 2011 to Human Resources managers in all Group Maisons. During training participants are encouraged to dissect the recruitment process and assess 3 The Group seeks original and relevant responses to social problems for which its know-how...

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    ... of a real home, as well as access to education. It is a partnership that appeals to the values of Louis Vuitton, and accordingly, the Maison is supporting the development of an education program for children in China, the Philippines, Vietnam, and the Dominican Republic, as well as in Europe. 10...

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    ... have to offer during the "Cultures and Creation" fashion show. Thanks to LVMH, the show's winner was able to exhibit her designs at the 2011 Ethical Fashion Show at the Carrousel du )/0 1 in the show's official opening. SUPPORTING EMPLOYABILITY AND ACCESS TO EMPLOYMENT the Group endeavors to...

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    ... BREAKDOWN OF AUDITS BY REGION 32% Europe 62% Asia 4% North America 2% Others Perimeter: Wines & Spirits, Louis Vuitton Leather Goods and Shoes, Fendi, Donna Karan, Céline, Marc Jacobs, Givenchy Couture, Kenzo, Loewe, Perfumes & Cosmetics, TAG Heuer, Hublot, Fred, Chaumet, DFS, Sephora. 12...

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    .... The latter is now of prime importance to our customers, employees and partners. Protecting the environment is not just a common ideal or legal obligation but a Group-wide challenge that underpins how we conduct our operations and builds a set of values that we share with our stakeholders. 13 / 24

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    ... involved Internal organization and specific commitments Key management resources and processes A Group-wide structured approach The Environment Department defines the Group's strategy and therefore reports Board of Directors, and Antonio Belloni, Group Managing Director of the Executive Committee...

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    ...on page 13 of the Sustainable Development section in this annual report. INTERNAL ORGANIZATION AND SPECIFIC COMMITMENTS ORGANIZATION AND TRAINING The main goal of the internal organization is to harness the commitment of all Group personnel and train them by offering resources best suited to their...

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    LVMH 2011 - Environment KEY MANAGEMENT AND EXTERNAL CERTIFICATION PROCESSES MANAGEMENT SYSTEMS AND CERTIFICATION GROUP-WIDE CARBON FOOTPRINTS Taking account of climate change is part of LVMH policy. Since 2002 the Group has assessed the Carbon Footprint of many of its Maisons: Louis Vuitton, Mo...

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    ...house and updated annually, identifies about forty materials that offer the kind of environmental performance required for the Group's products and explains how each business can use them. The materials are categorized by application: packaging, textiles and leathers, communications and store design...

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    LVMH 2011 - Environment ),ǁ'(3ǁ3 Research and Development department has focused on ethnobotany. The department identifies plant species from around the world that could be used in cosmetics and at the same time helps protect these species and develop local economies. Louis Vuitton ...

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    ..." Sustainable Development Commission and is part of the "clean production program" supported by the State and the Inter-American Development Bank (IDB). With regard to responsible alcohol consumption, Moët Hennessy adopted in 2003 and updated in 2008 its Marketing and Communications Code of Conduct...

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    ... plateaux in southern India. Following the earthquake and tsunami in Japan in March 2011 and independently of donations made to the Japanese Red Cross, Louis Vuitton is supporting the 0 the goal of which is to plant trees to help purify the seawater used for oyster farming #(ǁ."ǁ #3 nanced...

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    ... new Louis Vuitton sites and stores located in countries with an electricity-intensive CO2 and the updating of CO2 emission factors for electricity production. (3) Change due to the integration of Hublot and the increase in business volumes for watches and jewelry brands. Further information, best...

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    ...'s international art scene. The Louis Vuitton Foundation for Creation loaned two of the artist's works 22 / 24 for this event: Le Bateau de Larmes and Lagrimas. LVMH also renewed its support of Monumenta, an event organized by the French Ministry of Culture and Communication and of which the Group...

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    ...from educational programs designed and initiated by the Group to give them greater access to the best of culture, particularly in the areas of music and the visual arts. LVMH continued its program of classes in 2011 as part of its sponsorship of the "My Way" exhibition, dedicated to the work of Jean...

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    ... #(#-.,3ǁ) ǁ/&./,ǁ(ǁ)''/(#.#)(Żǁ 4#4ǁ'(#Żǁ &,#ǁ''(/&ǁ,,).#(Żǁ*#./,ǁ&#,,#-ǁ) ǁ  ǁ(ǁ,)/*Ɖ-ǁ #-)(-ź LVMH - 22, avenue Montaigne - 75008 Paris - France Tel.: 33 (0)1 44 13 22 22 - Fax: 33 (0)1 44 13 22 23 - www.lvmh.com 24 Design and production:

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    LVMH 2011 - ANNUAL REPORT FINANCE

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    ... BY BUSINESS GROUP THE WORLD'S LEADING LUXURY PRODUCTS GROUP A unique portfolio of over 60 PRESTIGIOUS BRANDS An international distribution network of 3,040 STORES Nearly 98,000 EMPLOYEES in over 60 COUNTRIES REVENUE of 23.7 BILLION EUROS in 2011 04 06 08 10 12 13 CONSOLIDATED BALANCE SHEET...

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    ... respectively. LVMH shares closed at â,¬109.40 on December 30, 2011. On that date LVMH's market capitalization amounted to â,¬55.6 billion, making LVMH the third largest company on the Paris stock exchange. LVMH is included in the major French and European indices used by fund managers, namely the...

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    ...DIVIDEND 2011 Gross dividend (in euros) Growth for the year Payout ratio(2) Group share of net earnings per share (in euros) 2.60(1) 24% 43% 6.27 2010 2.10 27% 34% 6.36 2009 1.65 3% 46% 3.71 STOCK MARKET DATA (in euros) High (during trading session) Low (during trading session) Year-end share price...

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    ... Spirits Fashion & Leather Goods Perfumes & Cosmetics Watches & Jewelry Selective Retailing Other activities and eliminations TOTAL 2011 1,101 3,075 348 265 716 (242) 5,263 % of sales OPERATING INVESTMENTS (EUR millions) 31% 35% 11% 14% 11% 22% 2009 2010 2011 976 729 1,730 NET PROFIT, GROUP SHARE...

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    ... Fashion & Leather Goods Perfumes & Cosmetics Watches & Jewelry Selective Retailing and Other activities 2011 REVENUE BY GEOGRAPHIC REGION OF DELIVERY (in %) 12% NUMBER OF STORES 2011 2010 3,040 2,545 2,423 France 21% Europe (excl. France) 2009 22% United States 8% Japan 27% Asia...

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    ... 6% Japan 26% Asia (excl. Japan) 15% Other markets FASHION & LEATHER GOODS (EUR millions) Revenue Profit from recurring operations Operating investments 2011 8,712 3,075 437 2010 7,581 2,555 370 2009 6,302 1,986 263 2011 REVENUE BY GEOGRAPHIC REGION OF DELIVERY (in %) 8% France 20% Europe...

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    ...% France 37% Europe (excl. France) 9% United States REVENUE BY PRODUCT CATEGORY (in %) 6% Japan 49% 34% 17% 22% Asia (excl. Japan) Perfumes Cosmetics Skincare products 16% Other markets WATCHES & JEWELRY (EUR millions) Revenue Profit from recurring operations Operating investments 2011...

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    ... pages are abbreviated. CONSOLIDATED BALANCE SHEET ASSETS (EUR millions) Brands and other intangible assets - net Goodwill - net Property, plant and equipment - net Investments in associates Non-current available for sale financial assets Other non-current assets Deferred tax 2011 11,482 6,957...

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    ... Finance LIABILITIES AND EQUITY (EUR millions) Share capital Share premium account Treasury shares and LVMH-share settled derivatives Cumulative translation adjustment Revaluation reserves Other reserves Net profit, Group share Equity, Group share Minority interests 2011 152 3,801 (485) 431 2,689...

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    ... the year represented a 1 billion euro increase (see comments on the cash ï¬,ow statement). Other non-current assets increased by 2.2 billion euros, mainly as a result of an increase in the market value of the Group's investment in Hermès International and additional purchases of Hermès shares on...

  • Page 149
    ... year-end 2011, representing an increase of 29%. This significant rise is mainly attributable to the following factors: the reserved capital increase by LVMH SA, in the amount of 2.2 billion euros, intended as consideration for the contribution of Bulgari shares by the company's family shareholders...

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    LVMH 2011 - Finance CONSOLIDATED INCOME STATEMENT (EUR millions, except for earnings per share) 2011 23,659 (8,092) 15,567 2010 20,320 (7,184) 13,136 2009 17,053 (6,164) 10,889 REVENUE Cost of sales GROSS MARGIN Marketing and selling expenses General and administrative expenses (8,360) (1,...

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    LVMH 2011 - Finance CONSOLIDATED STATEMENT OF COMPREHENSIVE GAINS AND LOSSES (EUR millions) 2011 3,465 190 47 237 2010 3,319 701 89 790 2009 1,973 (128) (20) (148) NET PROFIT BEFORE MINORITY INTERESTS Translation adjustments Tax impact Change in value of available for sale... in value of ...

  • Page 152
    ...powerful momentum of Louis Vuitton, which again recorded double-digit revenue growth. Céline, Loewe, Givenchy, Fendi, Donna Karan and Marc Jacobs also confirmed their potential, delivering double-digit revenue growth in 2011. Revenue for the Perfumes and Cosmetics business group increased by 9% on...

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    ...on strategic markets. The operating margin as a percentage of revenue for this business group increased by 2 points to 31%. Fashion and Leather Goods posted profit from recurring operations of 3,075 million euros, up 20% compared to 2010. Profit from recurring operations for Louis Vuitton increased...

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    ...current available for sale financial assets Impact of purchase and sale of consolidated investments (1) (1,730) 2,177 (518) 17 (785) (976) 3,073 (1,724) 70 (61) (729) 2,205 (93) 49 (278) NET CASH FROM (used in) FINANCIAL INVESTMENTS III. TRANSACTIONS RELATING TO EQUITY Capital increases of LVMH...

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    ... of real estate investments for commercial use or rental purposes, investments by Louis Vuitton, DFS and Sephora in their retail networks, and investments by the Group's champagne houses and Parfums Christian Dior in their production facilities, reï¬,ecting the Group's growth momentum. Non-current...

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    ... COMPREHENSIVE INCOME Stock option plan and similar expenses (Acquisition)/disposal of treasury shares and LVMH-share settled derivatives Exercise of LVMH share subscription options Retirement of LVMH shares Acquisition of a controlling interest in Bulgari Capital increase in subsidiaries Interim...

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    LVMH 2011 - Finance Revaluation reserves Available for sale financial assets Future foreign currency cash ï¬,ows Vineyard land Net profit and other reserves Total equity Group share Minority interests Total 510 1,480 31 (46) 703 11 14,402 17,198 1,646 1,006 33 400 433 3 772 4 (187) 20 (...

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    PHOTOGRAPHS - Jean-François Campos, Louis Vuitton / Bruno Aveillan. LVMH - 22, avenue Montaigne - 75008 Paris - France Tel.: 33 (0)1 44 13 22 22 - Fax: 33 (0)1 44 13 22 23 - www.lvmh.com 20 Design and production:

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