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  • Luxury Brand Loro Piana Under Judicial Administration Amidst Labour Exploitation Allegations

    Luxury Brand Loro Piana Under Judicial Administration Amidst Labour Exploitation Allegations

    Luxury fashion brand Loro Piana, a subsidiary of LVMH, has been placed under judicial administration for one year by a Milan court following allegations of labour exploitation within its Italian supply chain.

    Labour Exploitation Allegations

    The court ruled that Loro Piana had failed to properly supervise its subcontractors, leading to labour violations through indirect suppliers. This makes Loro Piana the fifth luxury label to face such allegations since last year, joining the ranks of Dior, Valentino, Armani, and Alviero Martini.

    Investigations conducted by Italy’s Carabinieri labour protection unit unveiled that one of the workshops had employed 10 Chinese workers, five of whom were undocumented. These workers were allegedly forced to work up to 90 hours per week and were paid only EUR4 per hour (US$4.6). They were also illegally housed at the site.

    These allegations surfaced when a worker reported being assaulted over unpaid wages, leading to the arrest of the workshop owner and the closure of the facility.

    Judicial Administration

    Although Loro Piana is not subject to a criminal investigation, the court has appointed an external administrator to oversee improvements to the brand’s supply chain oversight. If the company demonstrates substantial progress, the judicial administration could be lifted early, as has happened in similar cases involving Dior and Armani.

    Loro Piana has attributed these violations to unauthorised subcontracting. It was discovered that the company had outsourced work via two front companies to Chinese-owned workshops in Milan. These workshops lacked the necessary capacity for manufacturing.

    The company has since severed ties with the supplier and pledged to reinforce its control and audit activities as a means of ensuring compliance with its ethical and quality standards.

    Company Background

    Loro Piana, acclaimed worldwide for its luxury cashmere and wool products, was acquired by LVMH in 2013. The founding family still retains a 20% stake in the company. This past June, Frederic Arnault, son of LVMH’s chairman and CEO Bernard Arnault, was appointed as the company’s CEO.

    Questions & Answers

    What led to the legal action against Loro Piana?
    A worker reported being physically assaulted over unpaid wages, sparking an investigation that revealed labour violations within the company’s supply chain.

    What measures has the court imposed on Loro Piana?
    The court has appointed an external administrator to supervise reforms to the brand’s supply chain oversight. The company has also been placed under judicial administration for a year.

    What steps has Loro Piana taken since the allegations surfaced?
    Loro Piana has ended its relationship with the implicated supplier and committed to enhancing its control and audit activities to ensure compliance with its ethical and quality standards.

  • Record results for LVMH in 2018

    Record results for LVMH in 2018

    The world’s largest luxury retailer LVMH shrugged off broader market pessimism overnight reporting record revenue of €46.8 billion last year, up 10 per cent over 2017. Excluding the closure of the unprofitable Hong Kong airport duty-free business in December 2017, the group’s organic growth was 12 per cent. Every business division delivered what the company described as “excellent performances”.

    Group profit rose a staggering 21 per cent to €10 billion with operating margin reaching 21.4 per cent, an increase of 1.9 percentage points.

    “LVMH had another record year, both in terms of revenue and results,” said chairman and CEO Bernard Arnault. “The desirability of our brands, the creativity and quality of our products, the unique experience offered to our customers, and the talent and the commitment of our teams are the group’s strengths and have once again made the difference.”

    Arnault said this year the company would continue to innovate and target investments combining tradition and modernity.

    “In an environment that remains uncertain, we can count on the appeal of our brands and the agility of our teams to strengthen, once again, our leadership in the universe of high-quality products.”

    The company’s flagship Louis Vuitton business was a standout for the group, contributing much of the 15 per cent organic sales growth of the fashion and leather goods business division where profit from recurring operations was up 21 per cent.

    “Christian Dior had an excellent first full year within LVMH thanks to the creativity of Maria Grazia Chiuri for the women’s collections and to the arrival of Kim Jones, the new artistic director of Dior Homme,” the company said in its earnings statement.

    “Fendi and Loro Piana continued to assert their know-how throughout their collections. Celine entered a new and ambitious stage of its development with the arrival of Hedi Slimane as artistic, creative and image director of the brand.”

    Givenchy, Loewe and Kenzo “progressed well” while the other brands, Berluti and Rimowa continued to gain momentum.

    Watches and jewellery profit soars

    LVMH’s watches and jewellery business recorded organic revenue growth of 12 per cent – and a stunning 37 per cent increase in profit from recurring operations.

    “Bulgari performed very well and gained market share. Its iconic jewellery and watchmaking lines Serpenti, Diva’s Dream, B.Zero1, Lvcea and Octo grew strongly.”

    Chaumet’s growth was driven by the success of the Liens and Joséphine collections, particularly in Asia.

    In the watchmaking sector, Tag Heuer continued to expand its range and Hublot enjoyed strong growth, partly due to high visibility as the FIFA World Cup official timekeeper.

    DFS returns to profit

    A return to profitability for the travel-retail business DFS after it exited its Hong Kong airport concessions at the end of 2017 was a highlight of LVMH’s ‘selective retailing’ business unit last year. The business group achieved a 12 per cent improvement in organic revenue growth (excluding the airport business from the 2017 base comparison) and a 29 per cent improvement in profit.

    “DFS progressed strongly thanks to a particularly good performance in Hong Kong and Macau. The recently opened Gallerias in Cambodia and Italy also grew rapidly,” said LVMH.

    Sephora enjoyed unspecified growth in sales and market share, with strong online sales growth in Asia and North America. About 100 new stores opened worldwide, including the new Nanjing Road store in Shanghai and the first Sephora-branded stores in Russia.

    Scents of success

    The perfumes and cosmetics business division achieved organic revenue growth of 14 per cent, driven by the performance of its flagship brands, with profit from recurring operations up 13 per cent.

    “Parfums Christian Dior experienced remarkable growth and increased its market share in all regions of the world. The launch of its new perfume Joy and the exceptional worldwide success of Sauvage and the other iconic perfumes J’adore and Miss Dior are behind the strong growth of the Maison,” said LVMH.

    “Makeup and skincare also grew rapidly. Guerlain progressed well, driven in particular by the success of Abeille Royale in skincare and Rouge G in makeup. Benefit strengthened its leading position in the eyebrow segment and Parfums Givenchy accelerated its performance, thanks in particular to makeup and its new perfume L’interdit. Fresh and Fenty Beauty by Rihanna continued their exceptional growth.”

    Strong spirits

    The wines and spirits business group achieved organic revenue growth of 5 per cent and profit from recurring operations also increased by 5 per cent.

    “The business group reaffirmed its leadership position by pursuing its value strategy and balanced geographic development.”

    The Hennessy business enjoyed “strong momentum” in Mainland China, LVMH said.

  • Strong growth for LVMH Moet Hennessy Louis Vuitton

    Strong growth for LVMH Moet Hennessy Louis Vuitton

    LVMH Moet Hennessy Louis Vuitton boosted revenues by 10 per cent to €33.1 billion in the first nine months of this year.

    Organic sales grew 11 per cent compared to the same period last year and by 13 per cent after excluding the impact of the closed DFS concessions at Hong Kong International Airport at the end of the year. Every geographic market performed well, the company said. Third quarter revenue was up 10 per cent.

    The wines & spirits business group recorded organic revenue growth of 7 per cent during the first nine months, with Champagne volumes stable and Hennessy cognac volumes increased by 4 per cent, led by the US and Chinese markets.

    The fashion & leather goods business group achieved organic revenue growth of 14 per cent and 20 per cent reported, with the flagship Louis Vuitton brand the standout performer.

    “Ready-to-wear and shoes, in particular, experienced strong momentum with an excellent reception of the last two fashion shows of womenswear and menswear,” the company said in a statement.  “A new communication for Louis Vuitton perfumes was unveiled, marking the launch of the brand’s latest perfume creation. Christian Dior, consolidated since the second half of last year, enjoyed an excellent performance.

    Celine made progress and began a new chapter in its history with the first runway show of Hedi Slimane, which was a great success and created enormous resonance. Fendi and Loro Piana continued to grow. The other brands continued to strengthen,” the company said.

    LVMH Moet Hennessy Louis Vuitton’s perfumes & cosmetics business group recorded organic revenue growth of 14 per cent, driven in particular by the performance of its star brands Christian Dior, Guerlain and Givenchy.

    The watches & jewellery business group achieved organic revenue growth of 14 per cent, with Bulgari delivering “an excellent performance and gaining market share”.

    The selective retailing business group achieved organic revenue growth of 8 per cent in the first nine months of 2018, and 14 per cent excluding the airport concession closures in Hong Kong.

    Sephora’s organic revenue growth was strong, particularly in North America and Asia. The expansion and renovation of its distribution network is continuing with a new store concept in China and the first Sephora-branded store in Russia.

    “DFS performed well, especially in Hong Kong and Macao. The recent openings of T Galleria in Cambodia and Italy progressed well.”

    The company said that in an “uncertain geopolitical and monetary context, LVMH will continue to be vigilant” in the months ahead.

  • LVMH hits up record revenue in 2017

    LVMH hits up record revenue in 2017

    It has been another record year for luxury products group LVMH Moet Hennessy Louis Vuitton.

    Revenue increased by 13 per cent year on year to reach €42.6 billion (US$52.9 billion), while organic revenue growth was 12 per cent.

    All business groups recorded double-digit organic growth with the exception of wines and spirits, where second-half growth was hit by supply constraints.

    Profit from recurring operations reached €8.2 billion, up 18 per cent. Operating margin reached 19.5 per cent, while the group share of net profit was €5.1 billion, growth of 29 per cent.

    Describing the performance as “excellent”, LVMH chairman/CEO Bernard Arnault says the record year was partly because of a buoyant environment but above all a result of the creative strength of the group’s brands “and their ability to constantly reinvent themselves”.

    Key highlights of last year listed by the group include:

    ● Record revenue and profit from recurring operations.

    ● Growth in Asia, Europe and the US.

    ● The success of both iconic and new products at Louis Vuitton, “whose profitability remains at an exceptional level”.

    ● The acquisition of Christian Dior Couture.

    ● Growth at Fendi and Loro Piana.

    ● The first year of integration of Rimowa luggage.

    ● Strong momentum at Parfums Christian Dior, driven by product innovation.

    ● An excellent year for Bulgari and good progress at Hublot and Tag Heuer.

    ● Growth at Sephora.

    ● Free cashflow of €4.7 billion, up 20 per cent.

    “Significant” growth in China helped Hennessy cognac volumes grow by 8 per cent, with 7.5 million cases shipped despite the second-half supply constraints.

    In fashion and leather goods, key events of the year were products arising from collaborations with artist Jeff Koons as well as the Supreme brand, the launch of the brand’s first smartwatch and the inauguration of the Maison Louis Vuitton Vendome in Paris.

    There was rapid growth in Asia for the perfumes and cosmetics segment, and growth was particularly strong in Asia for Bulgari. Asia again shone in the selective retailing group with Sephora continuing to gain market share.

    LVMH says the year was a positive turning point for DFS, with new stores in Cambodia and Italy continuing to grow sales.

    Despite unfavourable currencies and geopolitical uncertainties, LVMH says it is well equipped to continue its growth momentum across all business groups this year.

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  • Loro Piana S/S18 collection : when luxury eases people’s life

    Loro Piana S/S18 collection : when luxury eases people’s life

    Last week, Loro Piana previewed 2018 Spring/Summer collection in the Entertainment Suite of The Mandarin Oriental in Hong Kong.

    The new collection features unique, sophisticated articles that combine a contemporary look with refined elegance. The collection includes iconic brand items featuring hallmark characteristics enhanced with the latest generation technology, playful colour combinations and unique details.

    The collection blends Loro Piana heritage with the latest trends of casual wear, athleisure, spa and travel outfits, linked by the common thread of the use of the finest natural raw materials , result of tireless research for an extreme sensorial experience.

    Main feature of the collection is the combination of the finest material with the functionality of garmets created to ease people’s life.

    Ladieswear presents a 360 degree collection : from athleisure to spa and travel items, from new “shirt tucked into skirt” creations to fur for Spring. Loro Piana also presented a wide range of accessories for a practical life on the go.

    The menswear selection gains inspiration from a universe that marries dynamics and style. It features a series of loose fitting, contemporary articles designed for urban wear and a life on the go. The main aspects of this range are water and windproof parkas, cashmere coats and jackets with 3L technology, guaranteeing comfort and performance.

    Every item in this range features a combination of materials with contrasting, high-performance technical details, offering weightless, crease resistant, functional articles that guarantee warmth and protection.

    The sea and sailing also feature, in the most sporty context, whether with light, technical items for sailing, such as the new My Song uniform with its windbreaker made from the revolutionary eco-friendly Green Storm System®, or with articles for wearing on land.

    The sea and sailing collection is inspired by Pier Luigi Loro Piana’s passion for sailing, culminated in its new 40 metre yacht a comfortable cruising boat named My Song. My Song is the most perfect example yet of the racer-cruiser species — a top predator as defined by its designers from Baltic Yachts.

    Additionally, another element bridges heritage and innovation in the collection. The line 175LP is the Pantone code for the brick shade, known as kummel, a signature colour for Loro Piana. This colour used on packaging, tags, and the covers of many of our publications and the trim inside the garments themselves carries a connotative meaning.

    This colour was chosen when the first Loro Piana stores opened at the end of the 1990s, and was applied to all the elements of brand identity. It is inspired by the warm shades of the brick walls of the factories built at the beginning of the last century, when Loro Piana was founded, harking back to the company’s original woollen mills and its heritage of time-honoured excellence in the textile industry which is still very much an integral part of the brand’s identity.

    This colour has been selected as the defining element and common theme of the 175LP line, and is deployed in different ways on the different garments and refined styling details. It is a symbol of our ongoing research into materials and our uncompromising vision of style and quality.

    Footwear options are enhanced by new models inspired by the 70s, in vibrant suede tones, with kummel coloured (toasted brown) details, lending them an air of refinement. The focus on authenticity allows Loro Piana to engage with artisans from all over the world to get the best of their craftsmanship, espadrilles from the collection are indeed realized in Spain to be faithful to the country where the product comes from.

    Under the spotlight also the Gift of Kings®, Loro Piana’s most exclusive wool. Just 2000 kg of the purest fibre measuring only 12 microns are produced per year and transformed into deliciously understated, soft, silky, sophisticated mens and womenswear articles, as well as ultralight vests and casual bombers.

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  • Marina Bay Sands Shoppes expands children’s collection

    Marina Bay Sands Shoppes expands children’s collection

    The Shoppes at Marina Bay Sands has added luxury label Dolce & Gabbana Junior to its growing line-up of luxury childrenswear retailers.

    The high end Singapore shopping centre which relaunched with a luxury focus in April, had already attracted Fendi Kids and Baby Dior to its retail store portfolio, part of a plan to build on its Children’s Collection to present more stylish options for “little adults”.

    Dolce & Gabbana Junior is the Italian designer label’s first Junior store in Southeast Asia.  Spanning more than 1400 sqft, the new boutique is painted with a pearl finish and furnished with lacquered wood furniture frames to create a shopping ambience that is soothing and refined. The Dolce & Gabbana Junior collection includes ready-to-wear for girls, boys, and newborn from ages up to 8.

    And more brands are yet to arrive.

    Come December, Armani Junior and Bonpoint will also be joining the The Shoppes’ Children’s Collection. Set to be its largest store in Singapore, the Armani Junior store will be showcased as a sleek and modernised concept for stylish juniors. It completes the family of Armani collections at The Shoppes – namely Armani/Marina Bay, the first and only duplex in Southeast Asia to house both Giorgio Armani and Emporio Armani, as well as Armani Collezioni.

    Armani Junior will open with its soon-to-launch Spring Summer 2016 collection featuring colorful and fun prints, while Bonpoint will unveil a selection of Shoppes-exclusive pieces from its Christmas 2015 collection and Cruise 2016 collection. Unique to the store is a special corner dedicated to its YAM collection which caters for young ladies and mothers, allowing for perfect mini-me looks that could be worn with their sisters or daughters. Bonpoint will also carry its full hypoallergenic skincare and signature perfume range in-store.

    The launch of Armani Junior and Bonpoint brings along a plethora of trendy ready-to-wear for newborns and children up to the ages of 16.

    Aside from the Children’s Collection, other boutiques that are opening at The Shoppes in the fourth quarter of 2015 include Ted Baker, the only Loro Piana store in Singapore, as well as the largest Michael Kors and Valentino stores in Singapore to date, spanning 3200 sqft and 3500 sqft respectively. More recently, the mall celebrated the opening of Furla’s Singapore flagship store and the biggest in Southeast Asia at 1600 sqft.

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