PARIS — Bernard Arnault kept an upbeat tone as LVMH Moët Hennessy Louis Vuitton reported flat net profits for 2008, but a 4 percent increase in fourth-quarter revenues to 5.23 billion euros, or $7.01 billion.
In fact, he said Louis Vuitton, which kept a double-digit sales pace in the quarter, would open more than 25 stores this year, and that the world’s largest luxury group would not cut its advertising spend as it seeks to win market share and keep the luxury dream alive.
“January was not a bad month — far from it,” Arnault told analysts and journalists at LVMH headquarters here Thursday, as images of the group’s celebrity spokesmodels — from Monica Bellucci to Leonardo DiCaprio — flashed behind him. “Having said that, visibility for the year is limited.”
To wit, the company gave no precise guidance for 2009 earnings or revenues.
LVMH’s net profits in 2008 totaled 2.03 billion euros, or $2.98 million, on a revenue rise of 4 percent to 17.19 billion, or $25.23 billion. Dollar figures are converted from euros at average exchange rates for the corresponding period. LVMH did not break out fourth-quarter figures.
Based on calculations by WWD, sales for the three months ended Dec. 31 rose 10.2 percent for fashion and leather goods; 5.7 percent for selective retailing and 2.2 percent for perfumes and cosmetics. Sales of wines and spirits fell 5.6 percent, while watches and jewelry were down 8.6 percent.
Sounding relaxed and confident, Arnault didn’t mince words about the gravity of the economic downturn, “something we haven’t seen in the 20 years we’ve been running this group.”
He mentioned one minority of economic experts who warn the crisis could last three to six years. “Let’s hope they’re wrong,” he said. “We’re lucky enough to have a sound balance sheet, which gives us room to maneuver in what is a difficult environment.…We will come out of this crisis in a stronger position.”
LVMH’s net financial debt at the end of 2008 stood at 3.87 billion euros, or $5.69 billion, a gearing of 28 percent.
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