At the conclusion of its 2021 fiscal year, LVMH, the world leader in luxury goods, reported impressive sales of 64.2 billion euros. This represents a remarkable growth of 44% compared to the challenging year of 2020, which was heavily impacted by the Covid-19 pandemic, and a 20% increase compared to 2019. CEO Bernard Arnault described these results as “remarkable performances.” The company achieved a net profit of 12 billion euros, representing a significant jump of 68% compared to 2019. Additionally, the available operating cash flow reached a new record of 13 billion euros, more than double that of 2020 and 2019.
The impressive figures were largely attributed to a strong acceleration in fourth quarter sales in 2021. These sales soared by 22% compared to 2019, thanks to the boost from the holiday season. Among LVMH’s sectors, the Fashion and Leather Goods sector experienced the highest growth, with a spectacular increase in sales of 42% compared to 2019. This was partly driven by increased local consumption. The Watches and Jewelry sector also saw a notable growth of 7% compared to 2019, which was influenced by the integration of American brand Tiffany&Co and its outstanding performance in terms of sales, results, and cash flow.
Sales of Wines and Spirits experienced a steady increase of 9% compared to 2019. LVMH attributed this growth to its strengthened value creation strategies, despite challenges faced in the supply chain market. Champagne and cognac volumes rose, mainly driven by the United States market.
The Perfumes and Cosmetics sector showed signs of recovery, surpassing its 2020 levels with a growth of 27% and nearly aligning with 2019 figures at -1%. LVMH highlighted the success of Dior’s fragrance Sauvage, which became the best-selling fragrance globally in 2021, marking a significant achievement for a men’s scent.
However, the Selective Retailing sector demonstrated mixed results with a decline of 18% compared to 2019. While Sephora, which acquired British brand Feelunique, exceeded its 2019 sales, thanks to online sales and store expansion in China and the USA, the decline in international travel continued to negatively impact travel retail specialist DFS.
To support its growth fueled by an ambitious acquisition strategy, LVMH announced a plan to hire 25,000 young people under the age of 30 by early 2023.
Useful links:
1. LVMH Press Release
2. Business of Fashion Article
