Excellent first half for LVMH

Paris, 24 July 2018

LVMH Moët Hennessy Louis Vuitton, the world’s leading luxury products group, recorded revenue of €21.8 billion in the first half of 2018, an increase of 10%. Organic revenue growth was 12% compared to the same period in 2017. It was up 14% when excluding the impact of the termination of the Hong Kong International Airport concessions at the end of 2017. The United States, Asia and Europe experienced good growth.

In the second quarter, revenue increased by 11% compared to the same period of 2017, a performance in line with the trends of the beginning of the year. Organic revenue growth was 11%.

Profit from recurring operations was €4 648 million for the first half of 2018, an increase of 28%. Operating margin reached 21.4%, an increase of 2.9 percentage points. Group share of net profit amounted to €3 004 million, an increase of 41%.

Bernard Arnault, Chairman and CEO of LVMH, commented: "The excellent results of the first half of the year attest to the strong desirability of our brands and the effectiveness of our strategy. The performance of the first half is even more remarkable given the unfavorable currency environment. The standards of quality and creativity required from our Maisons, which combine both modernity and tradition, are key to LVMH’s success, always driven by a long-term vision. Despite buoyant global demand, monetary and geopolitical uncertainties remain. In this context, we will stay vigilant and rely on the talent of our teams and the shared entrepreneurial passion to further increase our leadership in the world of high quality products in 2018."

Highlights of the first half of 2018 include:

- Double-digit increases in revenue and profit from recurring operations,

- Strong growth in Asia and the United States,

- Good start to the year for Wines and Spirits,

- Outstanding momentum at Louis Vuitton; profitability remains at an exceptional level,

- Success of new products at Christian Dior across all product lines,

- New creative talent at several fashion brands,

- Excellent performance of Bvlgari,

- Good performance of watch brands,

- Sephora's strong revenue growth in stores and online,

- Rebound of profitability at DFS,

- Cash from operations before changes in working capital was €5.5 billion, an increase of 21%,

- Net debt to equity ratio of 23% as of the end of June 2018.

Key figures

* Restated for the effects of the application of IFRS 9 Financial instruments.

** Before changes in working capital.

Revenue by business group:

* with comparable structure and constant exchange rates. The currency effect for the Group was -8% and the structural impact was +6%.

** + 15% excluding the termination of the Hong Kong International Airport concessions.

Profit from recurring operations by business group:

Wines & Spirits: strong momentum in China and good progress in Europe and the United States, despite supply constraints

The Wines & Spirits business group recorded organic revenue growth of 7%. Profit from recurring operations increased by 7%. The business group pursued its value strategy based on a strong policy of innovation and targeted investments in communication. In the champagne business, prestige vintages were particularly dynamic while a firm price increase policy continued. Europe and Japan progressed while the United States was in decline due to a delay in shipments. Hennessy cognac continued to show strong growth in the US market in a tight supply environment; the Chinese market continued to develop rapidly.

Fashion & Leather Goods: strong desirability at Louis Vuitton across all its activities and further strengthening of other brands

The Fashion & Leather Goods business group recorded organic revenue growth of 15%. Profit from recurring operations was up 27%. The remarkable growth at Louis Vuitton continues to be driven by its exceptional creativity, and by the right balance between tradition and modernity, the success of icons and the new creations by Nicolas Ghesquière. Of note during the first half was the arrival of Virgil Abloh, as Menswear Artistic Director, whose debut fashion show was widely commented on across social media, and was exceptionally well received. Christian Dior, consolidated since the second half of 2017, had an excellent performance. Kim Jones, appointed Artistic Director of Dior Homme, unveiled his first collection, which also received a formidable welcome. Céline entered a new and ambitious stage of its development with the appointment of Hedi Slimane as Artistic, Creative and Image Director of the brand, whose first collections will be presented in September. Fendi and Loro Piana continued to grow. Other brands further strengthened.

Perfumes & Cosmetics: all brands contributed to strong growth with rapid progress in Asia

The Perfumes & Cosmetics business group posted organic revenue growth of 16%. Profit from recurring operations was up 25%. Christian Dior achieved an outstanding performance, driven by the vitality of its iconic fragrances J'adore and Miss Dior, and by the great success of Sauvage. Makeup and skincare progressed strongly. Guerlain benefited from the remarkable growth of the iconic Rouge G lipstick and rapid progress in its skincare line, Abeille Royale. Parfums Givenchy maintained its rapid growth in makeup. Benefit successfully enhanced its mascara range and its Brow collection. Fresh, Fenty Beauty and Acqua di Parma grew strongly.

Watches & Jewelry: excellent first half for Bvlgari and good development of watch brands’ iconic product lines

The Watches & Jewelry business group recorded organic revenue growth of 16%. Profit from recurring operations was up 46%. Bvlgari had an excellent first half and continued to gain market share. This performance was especially notable in jewelry and in the Chinese and American markets. The iconic lines Serpenti, B-Zero 1, Diva and Octo made strong progress. Chaumet unveiled its new high-end jewelry collection. The momentum at TAG Heuer was reflected in the innovations of its flagship collections Carrera, Aquaracer and Formula 1, and a smaller version of its smart watch was launched. Hublot enjoyed strong growth and benefited from the enhanced visibility of the brand as the Official Timekeeper of the FIFA World Cup.

Selective Retailing: continued good momentum of Sephora and strong rebound of profitability at DFS

The Selective Retailing business group posted organic revenue growth of 9% or 15% excluding the closure of its concessions at Hong Kong International Airport. Profit from recurring operations was up 39%. Sephora achieved sustained growth across all areas of operation. With omni-channel at the heart of its strategy, online sales advanced rapidly. At the same time, Sephora expanded and renovated its store network. Le Bon Marché continued to cultivate its uniqueness and the exclusivity of its product offering; the online platform 24 Sèvres launched a year ago developed actively. DFS enjoyed an excellent start to the year. Performance was particularly good in Hong Kong and Macao while its Gallerias, recently opened in Cambodia and Italy, made remarkable progress. The termination of the loss-making Hong Kong International Airport concessions at the end of 2017 contributed to the strong rebound of profitability.

Outlook 2018

In the buoyant environment of the beginning of this year, albeit marked by unfavorable exchange rates and geopolitical uncertainties, LVMH will continue to pursue gains in market share through the numerous product launches planned before the end of the year and its geographic expansion in promising markets, while continuing to manage costs.

Our strategy of focusing on quality across all our activities, combined with the dynamism and unparalleled creativity of our teams, will enable us to reinforce, once again in 2018, LVMH’s global leadership position in luxury goods.

An interim dividend of 2 Euros will be paid on December 6^th, 2018.

Regulated information related to this press release, the half year results presentation and the half year financial statement are available on our internet site www.lvmh.com

Limited review procedures have been carried out, the related report will be issued following the Board meeting.

ANNEX

LVMH – Revenue by business group and by quarter

Revenue first half 2018 (Euro millions)

Revenue first half 2018 (organic growth compared to the first half 2017)

Revenue first half 2017 (Euro millions)

* Includes all Rimowa revenue for the first half of 2017.