September 29, 2023
LVMH posts file earnings and Bernard Arnault cheers ‘spectacular’ return of Chinese language vacationers

Hong Kong/Atlanta

LVMH posted file outcomes Thursday, and expressed confidence that China’s luxurious market would bounce again this yr because the nation continues to reopen.

The world’s greatest luxurious group logged income of €79.2 billion ($86.2 billion) and revenue of €21.1 billion ($22.9 billion) for 2022, each up 23%.

In a presentation, the corporate mentioned it was buoyed by the restoration of worldwide journey and robust demand from native clients throughout Europe, the USA and Japan.

And within the coming months, “now we have each purpose to [be] assured, certainly optimistic, on the Chinese language market,” LVMH

(LVMHF) CEO Bernard Arnault mentioned on a convention name.

“There are inexperienced shoots in China,” he informed analysts. “In Macao, the place Chinese language can now journey to, the change is sort of spectacular. Shops are full. It’s actually come again [at a] very robust tempo.”

The proprietor of manufacturers resembling Louis Vuitton and Sephora additionally has varied shops in France which are able to welcome Chinese language consumers as extra journey restrictions are rolled again, Arnault mentioned. He predicted, although, that Chinese language vacationers wouldn’t return in giant numbers till no less than the second half of the yr.

People posing for photos at a pop-up Louis Vuitton shop in Shanghai in January 2022.

China lifted among the world’s hardest Covid-19 border restrictions this month after practically three years, scrapping a quarantine requirement for worldwide vacationers.

Arnault famous that whereas LVMH was seeing indicators of restoration, it was nonetheless “early days.”

“We are able to’t assure it’s going to proceed like that,” he mentioned. “[But] if it continues as it’s, it will likely be a superb yr.”

Chief Monetary Officer Jean-Jacques Guiony additionally cautioned that the present degree of buyer site visitors in China was nonetheless about 40% beneath pre-pandemic ranges, and that the financial outlook was robust to foretell.

However in one other signal of optimism, LVMH proposed to hike its 2022 dividend on Thursday, from 10 euros to 12 euros per share. The proposal shall be up for approval on the firm’s common assembly in April.

LVMH is the most recent luxurious big to ship an upbeat forecast over China’s reopening. Final week, Swatch Group

(SWGAF), the proprietor of Omega and Harry Winston, predicted “a file yr in 2023,” primarily based on robust gross sales development it had already seen this month in China.

“After the top of Covid measures, consumption shortly recovered, not solely in China,” but in addition within the close by cities of Hong Kong and Macao, the Swiss watchmaker mentioned in a press release.

The elimination of Chinese language journey restrictions will seemingly additionally enhance gross sales in abroad vacationer locations, the corporate added.


(BBRYF), too, has pointed to indicators of “a superb restoration” in China this month, following a stoop attributable to the nation’s Covid-19 outbreaks and lockdowns within the final quarter.

Gross sales in mainland China fell 23% within the three months ended December, the British model mentioned while reporting earnings final week.

“Whereas the timing and tempo of restoration stays unsure for the remainder of this yr, we’re assured within the alternative and the long run prospects of the Chinese language market,” Julie Brown, the corporate’s chief working and monetary officer, informed analysts.