The world’s most powerful luxury goods CEO, LVMH’s Bernard Arnault. (Photo by Stefano Rellandini / … [+] AFP) (Photo by STEFANO RELLANDINI/AFP via Getty Images)
LVMH Moët Hennessy Louis Vuitton, the owner of multiple luxury brands including Tiffany, Louis Vuitton, and Dior, remains mired in an extended global downturn for high-end goods and is moving at pace to make its business more robust in troubled times. But the French luxury conglomerate saw its stock slide by more than 6% since Tuesday evening’s reveal of its 2024 annual results.
Turnaround measures have included appointing the company’s long-time chief financial officer Jean-Jacques Guiony to replace the current CEO of Moët Hennessy, its weakening wine and spirits division, from February. Meanwhile, at its poorly performing travel retail business DFS Group—rumored to be for sale—an interim CEO is restructuring the business after the departure of its former head, Benjamin Vuchot.
On Tuesday evening, billionaire LVMH chairman and CEO Bernard Arnault pushed back on divestment questions from analysts and press (based on live translations during the conference). On a query from BNP Paribas about Moët Hennessy potentially being for sale, Arnault pooh-poohed the idea and said: “It is not on the agenda.”
A little later a question about DFS and its possible divestment was met with less clarity. “I can’t tell you much… I can’t tell you anything, sorry,” said Arnault, an answer which will only fuel speculation that DFS is on the chopping block.
Further evidence of that came via a further query from French newspaper Le Monde on the lack of profitability at the luxury group’s Parisian department store La Samaritaine—supposedly to the tune of €90 million ($94 million). The store was part of the DFS portfolio. Guiony responded: “I have no idea where that figure comes from… it is entirely preposterous. The management was mainly focused on Chinese customers and we are taking it out of DFS Group and putting it into LVMH to focus on a broader customer base.”
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That is one explanation. Another is that if LVMH is looking to divest DFS as a going travel retail concern, making the business sale-fit would mean trimming its non-core assets. La Samaritaine is unlikely to appeal to global duty-free retailers such as Avolta or Lagardère Travel Retail as it is essentially a domestic retailer appealing to tourists.
A thing of beauty: La Samaritaine in Paris is now under LVMH’s wing, instead of DFS’s. (Photo by … [+] Frédéric Soltan/Corbis via Getty Images)
Furthermore, the department store is an iconic, must-see venue in Paris that, in many ways, is part of the identity of LVMH Group; letting it go is therefore not an option, regardless of