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LVMH profit jumps in 1999
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March 9, 2000: 10:33 a.m. ET
Sales of champagne, leather and fashion goods boost operating earnings
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LONDON (CNNfn) - France's LVMH Moet Hennessy Louis Vuitton, the world's biggest producer of luxury goods, said Thursday its 1999 operating profit rose a better-than-expected 31 percent on a boom in sales of champagne, clothes and leather goods.
The company, which sells luxuries from Dom Perignon champagne to Christian Dior perfumes, said operating earnings rose to 1.54 billion euros ($1.48 billion) from 1.18 billion a year earlier, ahead of analysts' expectations.
LVMH said it expects operating profit to grow at least 20 percent this year.
In the first two months of 2000, turnover rose 41 percent as sales of Louis Vuitton leather goods climbed 50 percent.
Shares in LVMH rose 3.8 percent to 385.8 euros in Paris.
"The economic environment is favorable for all of our markets, and growth should also be helped by the success of recent new product launches, the rapid growth of our distribution network and the growing strength of recent
acquisitions," the company said.
In September, the Paris-based firm paid $740 million for Swiss watchmaker TAG Heuer, while the following month LVMH and Prada beat out Gucci, Texas Pacific and Bulgari with a successful $900 million bid for fur and handbag group Fendi.
The company announced plans to launch a luxury-goods Web site called "eLuxury" that would be up and running next month, said Managing Director Myron Ullman. LVMH will have a stake of less than 50 percent in eLuxury, which will include other luxury brands besides those owned by LVMH.
The company also said it would invest "several hundred million francs" in online activities in 2000.
Profit before exceptional items and goodwill rose 40 percent to 738 million euros. Net income rose to 693 million euros from 267 million euros.
The company said it will pay a dividend of 3.40 euros, unchanged from the previous year. 
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