THE WHAT? LVMH has reported a net profit leap of 62 percent in H12021 as opposed to 2019, which was bolstered by record sales for its key fashion and leathers goods division, driven by Louis Vuitton and Dior.
THE DETAILS Revenue for Q2 reached €14.7bn, 14 per cent higher than the comparable period in 2019, excluding the impact of acquisitions and currency moves.
The growth was mainly attributed to the fashion and leather goods division, which posted sales of €7.3 billion in the three-month period to 30th June, an increase of 40 percent from 2019. Operating profit reached €7.63 billion.
The continued rise of the sector offset the weaker performance from the company’s selective retailing division, which relies largely on Duty Free in airports.
THE WHY? Luxury has proven time and time again to be pandemic proof, with the U.S. and China being the biggest markets for LVMH, highlighting that demand for premium goods only accelerated during COVID-19.
Chief Financial Officer Jean Jacques Guiony said, “Demand is strong everywhere in the world, and in almost all of our categories. We are coming out of the crisis with remarkable levels of profitability.”
LVMH shares rose approximately 30 percent this year to a high of US€673 per share on Monday, with reports that the positive results will fuel more M&A activity from the luxury behemoth.