LVMH, the luxury conglomerate headed by Bernard Arnault, is poised for strong growth in 2022. At the company’s Annual General Meeting in Paris, Arnault expressed optimism about the future and announced upcoming changes in top leadership positions. Among these changes is the repositioning of Fashion Group CEO Sidney Toledano, leading to speculation about his successor. Michael Burke, former CEO of Louis Vuitton, is emerging as a frontrunner for the position.
Arnault spoke highly of Burke’s exceptional leadership and credited him with elevating Louis Vuitton to become the top luxury brand. He also acknowledged the current CEO of Vuitton, Pietro Beccari, and expressed confidence in Delphine Arnault and Charles Delapalme, who now oversee the brand. Arnault shared impressive financial results for 2022, revealing a 16% increase in net profit, amounting to €14.7 billion, and a record-breaking 17% rise in turnover, reaching €79.2 billion. LVMH’s stock price has also experienced significant growth, outperforming the market average.
Arnault attributed the success of LVMH to the commitment and creativity of its teams, including artisans, managers, executives, and creators. He emphasized the company’s dedication to innovation, exceptional products, environmental sustainability, and the ability to generate desire among consumers. However, despite these achievements, there was an undercurrent of anxiety at the AGM as Arnault and senior executives addressed public perceptions of the conglomerate.
Earlier in the week, LVMH faced protests when their main headquarters were stormed by demonstrators opposing the French government’s decision to raise the retirement age. Arnault took the opportunity to dispute accusations of tax avoidance, asserting that LVMH pays more taxes than any other entity. The billionaire’s wealth has made him a target for anti-establishment protesters in France. To combat negative perceptions, LVMH showcased positive video commentaries from French economists at the AGM.
Although employees were not allowed to ask questions during the meeting, Arnault assured that LVMH is committed to its employees, treating them as family members. He also highlighted the company’s responsibility to the environment and social issues. The Arnault family, which holds the majority of LVMH’s voting rights, aims to maintain a positive public image and stressed the company’s substantial capital investments in France.
The AGM provided a platform for LVMH to showcase its sustainability and social initiatives. These initiatives include biodiversity regeneration, support for farmers in Chad, wildlife conservation, reforestation efforts in Brazil, and fabric recycling. The company also emphasized its commitment to employee mobility, with numerous employees transitioning to other companies within LVMH.
Looking ahead, Arnault expressed disappointment at not being able to attend an upcoming Louis Vuitton show in Seoul due to his commitment to a new Tiffany boutique opening in New York. He also mentioned future collaborations, such as Pharrell Williams joining Vuitton as a menswear designer. Additionally, he praised Dior for their successful showcases and mentioned LVMH’s expansion in California through acquisitions.
The AGM concluded with shareholders receiving a bottle of champagne and the announcement of LVMH’s 2022 dividend. Overall, the meeting highlighted LVMH’s accomplishments, strategic plans, and commitment to sustainability, leaving stakeholders satisfied with the company’s growth and prospects for the future.
Useful links:
– LVMH dividend announcement
– LVMH’s expansion in California
