The second half of 2003 saw an acceleration of growth in sales and operating income despite a fall of 6 per cent in net sales to €12.7 billion for the year. All sectors of the group contributed to this profit increase, with the exception of Watches & Jewelry.
Net income before goodwill amortization broke through the €1 billion threshold for the first time, up 25 per cent over 2002. LVMH stated that this improvement was largely due to lower financial expenses resulting from further debt reduction.
The perfume & cosmetics business group's operating income increased 11 per cent. Parfums Christian Dior continued to record high profitability along with the US company BeneFit that saw double-digit sales growth.
The success of the L'Instant - a new perfume for women launched by Guerlain - was one of the company's greatest successes of the year alongside the 2003 launches of Givenchy's Very Irresistible and Parfums Kenzo's Kenzo Air, which also contributed to the strong performance in the perfumes and cosmetics sector.
In the selective retailing division operating income increased four-fold to €106 million. DFS management reported positive results in 2003 and Sephora also improved its operating profitability both in Europe and in the US, where it became profitable for the first time.
The network of Sephora stores was further expanded in 2003 in Russia and Poland, two markets with high potential.
For 2004, the group stated that it has set itself the goal of 'a tangible increase in operating income', meanwhile continuing to concentrate on internal growth and the development of its leading brands.