LVMH – A strong leader
Financial Analysis

Table des matières I. Table des matières 2 II. Introduction 3 III. LVMH’s market: luxury products 4 A. Repartition of this market 4 1. Geographic 4 2. Segmentation 5 IV. LVMH among its market 6 A. Segments exploited by LVMH 6 1. Fashion and leather goods 6 2. Selective retailing 7 3. Wine and spirits 8 4. Perfumes and cosmetics 9 5. Watches and Jewellery 10 B. 2010, a sight of new growth 11 V. Financial analysis 12 A. Variation in the turnover 12 B. Variation in the net profit 12 C. Working capital management 13 D. Investments 13 VI. Conclusion 14

Introduction

LVMH is world number 1 of the luxury sector, is based in Paris and possess more than 60 sub companies among which Louis Vuitton, Fendi, Christian Dior perfumes, Guerlain... Each company is more or less running autonomously. These companies operate in five major activities that represent the five business units of the group: * Wines and Spirits * Fashion and Leather Goods * Cosmetics * Watches and Jewellery * Selective Retailing
With these activities, LVMH is present in 50 countries all over the world through 2423 shops and 77 000 employees. The turnover of the firm in 2009 was €17,053 billion and its net result €1,973 billion. According to estimations, LVMH draw 80% of its profits from Louis Vuitton.

LVMH’s market: luxury products
In 2009, the luxury market represented 153 billions Euros. It declined from 2008 by 7,8% due to the last financial crisis. Luxury products are the first category of products that suffer from decrease in purchasing power. This market reached its lowest level since 2005 as we can see on the next schema. For 2010, specialists expect a growth in sales for luxury products. In fact, a lot of products from this market are sold in duty free area in airport or during flights. Combining the growth of international and the occupation rate in luxury