Image: LVMH

LVMH Moet Hennessy Louis Vuitton revealed on Thursday that it generated revenue of 10.6 billion euros ($11.48 billion) for the first quarter of 2020. That represents a 15 percent drop for the three-month period ending March 31, with sales falling across all of its business segments – from its Fashion and Leather Goods group (down 9 percent on a reported basis) and Perfumes and Cosmetics division, where sales decreased 18 percent, to Watches and Jewelry, and Selective Retailing, which saw sales sink by 24 and 25 percent, respectively. 

“In the short term,” the Paris-based group – which owns Louis Vuitton, Christian Dior, Givenchy, Celine, Sephora, Bulgari, and soon, Tiffany & Co., among some 70 other fashion and non-fashion brands – states that “the measures taken by public authorities to combat the COVID-19 pandemic have resulted in the closure of production sites and stores in several countries which will have an impact on the group’s results.” Despite such an “unprecedented” retail landscape, LVMH says that it “has proven its ability to be resilient in an economic environment disrupted by the closure of stores and manufacturing sites in most countries in recent weeks, as well as the suspension of international travel.”

The Fashion and Leather Goods group, in particular – which is routinely the highest-earning division under the group’s umbrella – generated $5.04 billion over the three month period, down from $5.54 billion, the revenue for the division in Q1 of 2019. Of the division, LVMH says that “Louis Vuitton and Christian Dior, in particular, continued to show creative momentum, as illustrated by the latest runway shows and continuous enhancements to their iconic products,” while the division, as a whole, has seen rapid online sales growth.

Within the Perfumes and Cosmetics division, LVMH says that many of its brands are “benefiting from accelerating e-commerce in the context of COVID-19,” and the division is benefitting from demand for and the “resilience of skincare offerings.” It name-checked Dior’s “new Eau de Toilette Dior Homme, skincare Capture Totale and Miss Dior Rose N’Roses perfume,” as performing particularly well, along with Guerlain, which performing well in Asia “with strong online growth in China and continued success of skincare Abeille Royale.” Meanwhile, Perfumes Givenchy boasted “good performance of Le Rouge lipstick and Prisme Libre line,” along with “good performances of Acqua di Parma and Kurkdjian.”

In terms of its Selective Retailing, LVMH noted that it saw a “strong decline in revenue [in terms of its duty free venture, in particular] due to reduction in travel.”

Looking ahead, the group stated on Thursday, “We hope that the recovery happens gradually from May or June after a second quarter which will still be very affected by the crisis, in particular in Europe and the U.S.,” noting that “manufacturing sites of [its] Maisons are preparing to reopen with maximum safety conditions for employees following the suspension of activity in mid-March.” 

LVMH, which maintains the title of the largest luxury goods conglomerate in the world, says that it will propose cutting its dividends by 30 percent to 4.80 euros per share in light of the current financial landscape, while chairman and CEO Bernard Arnault and the members of LVMH’s executive committee have waived their salaries for the months of April and May, and also said they will forgo their bonus compensation for the year as a whole.

The report comes on the heels of the group previously warning that its first-quarter revenue was expected to fall between 10 percent and 20 percent.