Luxury proves enduring success for families
LVMH, the French luxury group controlled by the Arnault family, yesterday announced strong half-year results that firmly signals a rebound in the luxury market for family-controlled firms.
The group recorded an increase of 53% for group net profits to ?1.1 billion compared with 2009 results and a 16% increase in year-on-year revenues. LVMH, the world's largest luxury goods company, said it had seen strong revenue growth in emerging markets as well as in the US and Europe.
Family chairman and CEO Bernard Arnault (pictured) said in a statement: "The 2010 first half results, once again, demonstrate the exceptional appeal of our brands as well as the effectiveness of our strategy, as pertinent in the context of the recovery of 2010 as it was during the global economic crisis in 2009."
The company is not alone in seeing a rebound in the luxury sector during 2010; family-controlled Hermes last week reported a 23% increase in sales for the first half of 2010, seeing growth in Europe and the US as well as across Asia. (Continue reading here) Luxury cosmetic group L'Oreal has also seen growth this year, with sales up 12% in the first half.
But Arnault did add a note of caution on the recovery: "This focus on cost control will continue into the second half of the year despite the momentum in the markets."
LVMH, which includes brands such as Dom Perignon, TAG Heluer and Marc Jacobs, began in 1987 after Arnault used his family's money to purchase Christian Dior.
Daughter Delphine joined the company in 2000 and became the first woman on the board in 2003 at the age of 29. She still holds a management position and is actively involved in the fashion brands, particularly Louis Vuitton. The Arnault family own a majority stake in LVMH through the family's holding company, Groupe Arnault.
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