LVMH Moët Hennessy Louis Vuitton : 2020 First Half Results

FIRST2020HALF

RESULTS

JULY 27, 2020

Louis Vuitton

DISCLAIMER

2

This document may contain certain forward looking statements which are based on estimations and forecasts. By their nature, these forward looking statements are subject to important risks and uncertainties and factors beyond our control or ability to predict, in particular those described in LVMH's Universal Registration Document which is available on the website (www.lvmh.com). These forward looking statements should not be considered as a guarantee of future performance, the actual results could differ materially from those expressed or implied by them. The forward looking statements only reflect LVMH's views as of the date of this document, and LVMH does not undertake to revise or update these forward looking statements. The forward looking statements should be used with caution and circumspection and in no event can LVMH and its Management be held responsible for any investment or other decision based upon such statements. The information in this document does not constitute an offer to sell or an invitation to buy shares in LVMH or an invitation or inducement to engage in any other investment activities.

FIRST HALF 2020 RESULTS

3

GOOD RESILIENCE IN FIRST HALF 2020

FOR LVMH

| Good resilience, notably from major brands, in an economic environment disrupted by a global health crisis

| Absolute priority placed on the health and safety of our employees and customers | Direct support in the fight against the epidemic

| Impact of crisis on revenue worldwide, with, however, a strong recovery in second quarter in China

| Significant acceleration in online sales, only partially offsetting the impact on revenue of several months of store closures

| Destocking by retailers for Perfumes & Cosmetics and Watches

| Suspension of international travel, severely penalizing travel retail and hotel activities

Louis Vuitton

FIRST HALF 2020 RESULTS

BUSINESS

GROUP

REVIEW

Christian Dior Couture

FIRST HALF 2020 RESULTS

WINES &

SPIRITS

Dom Pérignon

FIRST HALF 2020 RESULTS

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WINES & SPIRITS

KEY FIGURES

In millions of euros					Champagne and Wines		Cognac and Spirits
• REVENUE								- 20%
Organic growth								- 23%
										1 985
H1 2020				754			1230
H1 2019				960		1526	2 486
• PROFIT FROM RECURRING OPERATIONS			- 29%
H1 2020			103				448			551
H1 2019				214			558			772

FIRST HALF 2020 RESULTS

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WINES & SPIRITS

H1 2020 HIGHLIGHTS

Good resilience in the US, at retailers, and encouraging recovery in China; decrease in volume but recent gradual improvement

| CHAMPAGNE & WINES

• Champagne: volumes -30 %

• Strong impact on consumption; especially in restaurants and night clubs

• New prestige cuvées from Dom Pérignon and Krug

• Integration of Château d'Esclans, high-end rosé wine, acquired end 2019

| COGNAC & SPIRITS

• Hennessy: volumes -15 %

• Rebound of revenue in China in the second quarter

• Strong resilience of American market, in particular for Hennessy V.S

• Launch of « Unfinished Business » initiative in support of African-American, Hispanic and Asian family businesses in the US

• International awards for Glenmorangie and Ardbeg

Veuve Clicquot

FIRST HALF 2020 RESULTS

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WINES & SPIRITS

2020 OUTLOOK

| Maintain value creation strategy

| Uncertain business environment, notably in hotel and catering sectors

| Product innovations, adapting to new ways of consumption, online sales and communication to win over new customers

| Rigorous management of costs and inventories; targeted investments in key markets | Continued actions linked to environmental initiatives

Hennessy

FIRST HALF 2020 RESULTS

FASHION &

LEATHER

GOODS

Christian Dior Couture

FIRST HALF 2020 RESULTS

10

FASHION & LEATHER GOODS

KEY FIGURES

In millions of euros

• REVENUE	- 23%
Organic growth	- 24%
						7 989
H1 2020
H1 2019						10 425
• PROFIT FROM RECURRING OPERATIONS	- 46%
H1 2020						1 769
H1 2019						3 248

FIRST HALF 2020 RESULTS

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FASHION & LEATHER GOODS

H1 2020 HIGHLIGHTS

| Outstanding resilience of major brands despite closed stores and production sites in several countries; strong online sales increases

| Louis Vuitton: great creative momentum, combining modernity and desirability

• Animation of iconic products and new collections Pont 9, Escale and Taïgarama
• Strengthened customer relations through innovative digital initiatives
• Opened Maison Louis Vuitton in Osaka Midosuji in Japan

| Christian Dior Couture: market share gain in all regions

• Inspiring women's and men's fashion shows
• Development of emblematic products thanks to creative animations
• New podcasts Dior Talks, with artists and employees

| Fendi: collaboration California Sky, reinterpretation of iconic products

| Loro Piana: opened flagship store in Ginza district in Tokyo

| Celine: good welcome of Triomphe line

| Loewe: new edition of Paula's Ibiza collection imagined by Jonathan Anderson

| Givenchy: new artistic director, Matthew M. Williams

Fendi

FIRST HALF 2020 RESULTS

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FASHION & LEATHER GOODS

2020 OUTLOOK

| Maintain strong creative momentum at Louis Vuitton

• Continue to enhance products in all categories
• Unique experiences in store network and digital space

| Christian Dior Couture

• Launch of Air Dior capsule, notably the limited edition Air Jordan sneakers
• New store in Paris, rue Saint-Honoré
• « Christian Dior, Couturier du Rêve » exhibition in Shanghai

to celebrate the extraordinary brand heritage

| Fendi: projects linked to Rome and preservation of savoir-faire

| Continue creative reinforcement at other brands to take advantage of gradual return to normal

Loewe

FIRST HALF 2020 RESULTS

PERFUMES &

COSMETICS

Parfums Christian Dior

FIRST HALF 2020 RESULTS

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PERFUMES & COSMETICS

KEY FIGURES

In millions of euros

• REVENUE	- 29%
Organic growth	- 29%
				2 304
H1 2020
H1 2019						3 236
• PROFIT FROM RECURRING OPERATIONS		na
H1 2020				- 30
H1 2019			387

FIRST HALF 2020 RESULTS

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PERFUMES & COSMETICS

H1 2020 HIGHLIGHTS

| Good resilience in a context of significant destocking by retailers and development of parallel distribution channels in which our brands did not want to participate

| Mobilization of employees to manufacture hydroalcoholic gel for hospitals | Parfums Christian Dior: vitality of iconic lines and innovation momentum

• Promising launch of Miss Dior Rose N'Roses and new Dior Homme
• New exceptional fragrance Rouge Trafalgar in Maison Christian Dior collection
• Breakthrough in skincare with Dior Prestige and Capture Totale Super Potent

| Guerlain: good performance driven by skincare Abeille Royale and Orchidée Impériale, good recovery in China and online sales

| Fenty Beauty: excellent sell-out in all regions

| Great performances for Fresh and Ole Henriksen, solid development for Acqua di Parma and Maison Francis Kurkdjian

Guerlain

FIRST HALF 2020 RESULTS

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PERFUMES & COSMETICS

2020 OUTLOOK

| Maintain innovation and creative momentum despite an uncertain environment

| Parfums Christian Dior: support iconic and new products in line with Couture and its roots in Grasse

• Innovations in all categories
• Continue promising development of Dior Prestige and Capture lines
• Strengthen digital presence notably in e-commerce

| Guerlain: new concept stores to illustrate high-end positioning

| Parfums Givenchy: roll-out of Irresistible Givenchy, which started well

| Fresh: opened new concept stores in China with new services

| Parfums Loewe: launch of home fragrance line, developed in collaboration with Jonathan Anderson

Parfums Givenchy

FIRST HALF 2020 RESULTS

WATCHES &

JEWELRY

Bvlgari

FIRST HALF 2020 RESULTS

18

WATCHES & JEWELRY

KEY FIGURES

In millions of euros

• REVENUE	- 38%
Organic growth	- 39%
				1 319
H1 2020
H1 2019						2 135
• PROFIT FROM RECURRING OPERATIONS		na
H1 2020				- 17
H1 2019			357

FIRST HALF 2020 RESULTS

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WATCHES & JEWELRY

H1 2020 HIGHLIGHTS

| Rebound in China, destocking at retailers

| Bvlgari: strong recovery in China in the second quarter

• New B.Zero1 Rock collection well received in the US and Asia
• Rapid development of e-commerce
• Creation of Bvlgari Virus Free fund, in collaboration with Oxford University

| TAG Heuer: successful launch of the third generation connected watch; new e-commerce website

| Hublot: initiation of online sales on hublot.com website, 40th anniversary celebration, opening of Ginza Hublot Tower in Tokyo

| Chaumet: reopened historical site of Place Vendôme in Paris and developed retail business in China

TAG Heuer

FIRST HALF 2020 RESULTS

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WATCHES & JEWELRY

2020 OUTLOOK

| Maintain objective of market share gains in 2020 | Launch innovations to take advantage of recovery

| Maintain investments to support new products, especially in digital

| Bvlgari: launch of high-end jewelry collection Barocko and roll-out of B.Zero1 Rock in all regions

| TAG Heuer: celebration of 160th anniversary with launch of limited editions

| Hublot: introduction of new Big Bang with innovations including connected model | Strengthening of store network in China for Chaumet, Hublot and Fred

Bvlgari

FIRST HALF 2020 RESULTS

SELECTIVE

RETAILING

Sephora

FIRST HALF 2020 RESULTS

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SELECTIVE RETAILING

KEY FIGURES

In millions of euros

• REVENUE	- 32%
Organic growth	- 33%
				4 844
H1 2020
H1 2019
						7 098
• PROFIT FROM RECURRING OPERATIONS		na
H1 2020				- 308
H1 2019			714

FIRST HALF 2020 RESULTS

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SELECTIVE RETAILING

H1 2020 HIGHLIGHTS

Market share gains at Sephora and strong impact of international travel suspension at DFS

| SEPHORA

• Good resilience and high market share gains in key countries
• Very strong increase of online sales and store/digital hybrid format
• Success of« Virtual Sephora Day » in China, digital event with strong impact on beauty trends
• Launched Size Up mascara for Sephora Collection

| DFS

• Significant decline in activity due to extensive disruption of international travel and store closures
• Focused on management and cost control to respond to the situation
• Developed digital communication with customers to prepare the future

DFS

FIRST HALF 2020 RESULTS

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SELECTIVE RETAILING

2020 OUTLOOK

| SEPHORA

• Strengthen leadership in digital with innovative services
• Accelerate development in skincare products
• Product innovations and development of personalized services

| DFS

• Continue efforts to reduce costs
• Gradual reopening of downtown stores in Venice, Macao, Hong Kong

| LE BON MARCHÉ

• Feature an exhibition in autumn dedicated to Belgium

Le Bon Marché

FIRST HALF 2020 RESULTS

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PERFORMANCE AND RESPONSIBILITY

| Direct support to fight the epidemic, worldwide

• Help for health care providers
• Manufactured hydroalcoholic gel; assisted with routing and production of masks
• Aided in locating equipment for hospitals and provided financial support

| Promote diversity and human potential within the Group

• Respect the uniqueness of our employees
• Pass on and develop savoir-faire
• Support our employees by improving their safety and well-being
• Empower local communities

| Pursue Group commitment to protect the environment

• Inspire creativity through eco-design
• Ensure responsible supply chain
• Combat climate change

• Improve environmental performance of sites and stores

FIRST HALF 2020 RESULTS

CONSOLIDATED

KEY FIGURES

H1 2020

Louis Vuitton

FIRST HALF 2020 RESULTS

27

H1 2020 REVENUE

BY BUSINESS GROUP

In millions of euros	H1 2019	H1 2020	Reported	Organic
growth	growth*
WINES & SPIRITS	2 486	1 985	- 20%	- 23%
FASHION & LEATHER GOODS	10 425	7 989	- 23%	- 24%
PERFUMES & COSMETICS	3 236	2 304	- 29%	- 29%
WATCHES & JEWELRY	2 135	1 319	- 38%	- 39%
SELECTIVE RETAILING	7 098	4 844	- 32%	- 33%
OTHERS & ELIMINATIONS	(298)	(48)	-	-
TOTAL LVMH	25 082	18 393	- 27%	- 28%

* With comparable structure and exchange rates. The exchange rate impact was + 1% and the structural impact was almost flat.

As table totals are calculated based on unrounded figures, there may be slight discrepancies between these totals and the sum of their component figures.

FIRST HALF 2020 RESULTS

28

REVENUE EVOLUTION

BY BUSINESS GROUP

Organic growth	Q1 2020	Q2 2020	H1 2020
versus same period in 2019
WINES & SPIRITS	-	14%	-	33%	-	23%
FASHION & LEATHER GOODS	-	10%	-	37%	-	24%
PERFUMES & COSMETICS	-	19%	-	40%	-	29%
WATCHES & JEWELRY	-	26%	-	52%	-	39%
SELECTIVE RETAILING	-	26%	-	38%	-	33%
TOTAL LVMH	- 17%	- 38%	-	28%

FIRST HALF 2020 RESULTS

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H1 2020 REVENUE BREAKDOWN

BY REGION

In % of total revenue

16%

24%	8%	EUROPE
	(excl. France)
UNITED STATES	FRANCE	34%	7%
(inc. Hawaii)			JAPON
		ASIA
		(excl. Japan)

11%

OTHER

MARKETS

FIRST HALF 2020 RESULTS

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REVENUE EVOLUTION

BY REGION

Organic growth	Q1 2020	Q2 2020	H1 2020
versus same period in 2019
UNITED STATES*	-	8%	-	39%	-	24%
JAPAN	-	10%	-	54%	-	32%
ASIA (EXCL. JAPAN)	-	32%	-	13%	-	24%
EUROPE	-	10%	-	54%	-	33%
* Excl. Hawaii.

FIRST HALF 2020 RESULTS

31

INCOME STATEMENT

SUMMARIZED

In millions of euros	H1 2019	H1 2020	% Change
REVENUE	25 082	18 393	-	27%
GROSS MARGIN	16 635	11 391	-	32%
Marketing and selling expenses	(9 563)	(8 000)	-	16%
General and administrative expenses	(1 789)	(1 699)	-	5%
Equity investment income	12	(21)
PROFIT FROM RECURRING OPERATIONS	5 295	1 671	-	68%
Other operating income and expenses	(54)	(154)
OPERATING PROFIT	5 241	1 517	-	71%
Net financial income (expense)	(205)	(462)
Income taxes	(1 431)	(511)
NET PROFIT BEFORE MINORITY INTERESTS	3 605	544	-	85%
Minority interests	(337)	(22)
GROUP SHARE OF NET PROFIT	3 268	522	- 84%

FIRST HALF 2020 RESULTS

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MONTHLY ANALYSIS OF OPERATIONAL LEVERAGE

FIRST HALF 2020 RESULTS

33

PROFIT FROM RECURRING OPERATIONS

BY BUSINESS GROUP

In millions of euros	H1 2019	H1 2020	% Change
WINES & SPIRITS	772	551	-	29%
FASHION & LEATHER GOODS	3 248	1 769	-	46%
PERFUMES & COSMETICS	387	(30)		-
WATCHES & JEWELRY	357	(17)		-
SELECTIVE RETAILING	714	(308)		-
OTHERS AND ELIMINATIONS	(183)	(294)		-
TOTAL LVMH	5 295	1 671	-	68%

FIRST HALF 2020 RESULTS

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EVOLUTION OF PROFIT FROM RECURRING OPERATIONS

In millions of euros

Organic Structural Currency

impact effect

5 295	- 3 614	- 72	+ 62
			1 671
H1			H1
2019			2020

FIRST HALF 2020 RESULTS

35

CHANGE IN NET FINANCIAL INCOME (EXPENSE)

In millions of euros	H1 2019	H1 2020	Change (M€)
COST OF NET FINANCIAL DEBT	(51)	(46)	+	5
INTEREST ON LEASE LIABILITIES	(145)	(149)	-	4
COST OF CURRENCY DERIVATIVES	(102)	(116)	-	14
FAIR VALUE ADJUSTMENT OF AVAILABLE	101	(136)	-	237
FOR SALE FINANCIAL ASSETS
OTHER ITEMS - NET	(8)	(15)	-	7
NET FINANCIAL INCOME (EXPENSE)	(205)	(462)	- 257

FIRST HALF 2020 RESULTS

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SOUND FINANCIAL STRUCTURE

Change versus December 31, 2019

• Decrease in intangible fixed assets due to revaluation of purchase commitments for minority interests

• Increased inventories resulting from usual seasonality of Group's businesses whose effect is mitigated by the revenue decrease

• Decline of total equity linked to the payment of the dividend balance partially offset by semester's net result

• Increase of financial debt mainly due to pre-financing of Tiffany & Co acquisition

In billions of euros

103.6103.6

			36%	Total
Non current	65%		equity
assets			Non current
			41%
			liabilities
Inventories	14%
Other current	21%	23%	Current
assets			liabilities
		ASSETS	LIABILITIES

June 30, 2020

FIRST HALF 2020 RESULTS			37
ANALYSIS OF CASH FLOW FROM OPERATIONS
	In millions of euros	H1 2019	H1 2020	Change (M€)
	CASH FROM OPERATIONS BEFORE CHANGES	7 399	4 421	- 2 978
	IN WORKING CAPITAL
	Cost of net financial debt: interest paid	(37)	(42)	- 5
	Lease liabilities: interest paid	(109)	(142)	- 33
	Tax paid	(1 191)	(1 382)	- 191
	Change in working capital	(1 873)	(2 005)	- 132
	NET CASH FROM OPERATING ACTIVITIES	4 189	850	- 3 339
	Operating investments	(1 423)	(1 414)	+ 9
	Repayment of lease liabilities	(1 071)	(1 157)	- 86
	OPERATING FREE CASH FLOW*	1 695	(1 721)	- 3 416

* Before available for sale financial assets and investments, transactions relating to equity and financing activities.

FIRST HALF 2020 RESULTS							38
NET FINANCIAL DEBT
In millions of euros
				8 684		8 230
			7 359
		7 153
						6 206
5 303			**5 487
3 244	3 850
24%	23%	25%
20%	16%	22%
12%	14%		16%
30/06/2016 31/12/2016***	30/06/2017 31/12/2017***	30/06/2018	31/12/2018*** 30/06/2019	31/12/2019* 30/06/2020
		Net financial debt			Gearing

• Incorporating for the first time the effects of the application of IFRS 16 Leases.
• Belmond shares deducted from net financial debt (€274m).

*** Restated to reflect the application of IFRS 9 Financial instruments. Previous years are presented without restatement.

FIRST HALF 2020 RESULTS

CONCLUSION

Louis Vuitton

FIRST HALF 2020 RESULTS

40

MAINTAIN VIGILANCE & STRONG ADAPTABILITY

FOR 2020 SECOND HALF

| Gradual recovery expected in the second half; impossible to have a precise evaluation of impact on 2020 annual revenue and results given uncertainty of timing and pace of "return to normal"

| Discipline in terms of costs and investments

| Continue creative momentum of our Maisons, driven by a long-termvision, staying focused on preserving value of our brands and on quality of our products and services

| Enhance our customers' experience in our stores and online, capitalize on digital opportunities

| Ongoing focus on Group commitment to preserve the environment and social responsibility

| Build upon entrepreneurship, excellence and reactivity of our teams

	Objective of LVMH
Christian Dior Couture	REINFORCE OUR LEADERSHIP POSITION IN GLOBAL LUXURY GOODS MARKET