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Family Business Roundup: LVMH, L’Oreal, PPR, VW post gains, net income down at America Movil

It has been a good week for top European family businesses, as the continent’s biggest carmaker, Volkswagen, and leading French luxury conglomerates LVMH and PPR reported significant revenue growth for the first half of 2012.

It has been a good week for top European family businesses, as the continent’s biggest carmaker, Volkswagen, and leading French luxury conglomerates LVMH and PPR reported significant revenue growth for the first half of 2012.

LVMH, controlled by Bernard Arnault and his family, announced on 26 July half-yearly revenues of €13 billion, up 26% from €10.29 billion in the first six months of last year.

Operating profit from recurring operations was up 20% to €2.66 billion, thanks to strong performance at two of its divisions – watches and jewellery, and wines and spirits – and by its multi-brand retail beauty chain Sephora.

Despite the ongoing economic uncertainties in Europe, the company expects further global growth by increasing product launches and expansion into “promising markets”, it said in a statement on 26 July.

Revenues likewise were up 17% at PPR, the luxury and retail group controlled by the Pinault family.

The company posted half-yearly revenues of €6.4 billion, from €5.5 billion in 2011. Revenue generated outside of the eurozone rose 13.2% in the first half of 2012 and represented 59.2% of the group total, PPR said on 26 July.

Meanwhile, on the same day, L’Oreal, the world’s largest cosmetics and beauty company, posted first-half revenues of €11.2 billion, up 10.5% on the same period in 2011. Much of the growth came from increased sales of cosmetics in North America and Asia, Africa and the Middle East.

Emerging markets have become the company’s “number one geographic zone”, while North America is “growing fast”, said non-family chairman and chief executive Jean-Paul Agon in a statement. L’Oreal is controlled by the French Bettencourt family.

In Germany, automotive manufacturer Volkswagen, controlled by the Porsche and Piech families, saw its half-yearly 2012 revenues rise to €95.4 billion, up 22.6% from €77.8 billion in the first six months of 2011.

However, the world’s richest man, Carlos Slim, hasn’t been so lucky of late. While revenues were up at America Movil, the mobile phone firm controlled by the Slim family, net income fell by 45.5% during the second quarter to 13.3 billion Mexican pesos, the company said on 26 July.

It blamed a foreign exchange loss of 16.1 billion Mexican pesos and “rising financing costs”, including the acquisition of a 25% stake in Dutch phone company KPN.

KPN also reported a decrease in its net income this week, down 13% to €2.24 billion. Revenues fell 2% to €6.38 billion.  

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