Louis Vuitton 2011 Annual Report Download - page 148

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LVMH 2011
Finance
10 / 20
COMMENTS ON THE CONSOLIDATED
BALANCE SHEET
The significant increase in non-current assets compared
to 2010 is chiefly attributable to the consolidation of Bulgari
in 2011. Non-current assets thus represented 72% of total assets
as of December 31, 2011, compared to 70% at year-end 2010.
Tangible and intangible fixed assets increased by 5.6 billion
euros, with 4.2 billion euros of this amount arising from first-
time consolidations during the year. This relates primarily to
Bulgari, whose brand was provisionally valued at 2.1 billion
euros, with goodwill amounting to 1.5 billion euros. Net of
amortization and depreciation charges, investments for the
year represented a 1 billion euro increase (see comments on
the cash flow 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 the market. The Group’s 22.4%
stake in Hermès represented an amount of 5.4 billion euros as
of December 31, 2011.
Inventories increased by 1.5 billion euros. Inventories held
by entities acquired during 2011, mainly Bulgari, accounted for
0.7 billion euros of this increase, with the remainder attribut-
able to growth in the Group’s businesses.
Other non-current liabilities increased from 11.9 billion euros
at year-end 2010 to 14 billion euros at year-end 2011. This
increase was due to the recognition of a deferred tax
liability in respect of the Bulgari brand (0.7 billion euros), an
increase in long-term net financial debt (0.7 billion euros), and
an increase in commitments to purchase minority interests
(0.5 billion euros).
Other current liabilities increased by 1.2 billion euros
compared to year-end 2010, reflecting growth in the Group’s
businesses.
The ratio of net financial debt to equity rose by 5.1 points
to 19.8% as of December 31, 2011. This increase was the result of
a 2 billion euro increase in net financial debt and a 5.4 billion
euro increase in equity.