LVMH rides out difficult times

THE world's leading luxury goods group, LVMH, today confirmed its pedigree, revealing that operating profits last year were about 7% ahead of the e2bn (£1.4bn) achieved in 2002.

The rise, to about e2.14bn, was achieved despite war in Iraq, Sars, the slump in air travel and the enfeebled US dollar that together blighted the performance of rivals such as Gucci of Italy and Richemont of Switzerland.

Overall, sales for the year were down 6% to e12bn. But stripped of currency effects and disposals, underlying growth was 4%. Sales accelerated in the fourth quarter to be only 1% behind those of 2002.

Chairman Bernard Arnault, the richest man in France, said the group was aiming to increase operating income again this year together with market share despite 'an economic and monetary environment which should remain challenging'.

The star performer last year remained the Louis Vuitton luggage brand but sales at Italian leather goods subsidiary Fendi continued to blossom.

The fashion and leather business, which includes Thomas Pink shirts, Kenzo, Loewe, Christian Lacroix and Donna Karan, achieved like-for-like growth of 9%. Sales of wines and spirits, including Moet, Dom Perignon and Krug champagnes and Hennessy cognac, fell 7% but achieved an underlying 5% rise.