Post on 12-Feb-2017
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GLOBAL LUXURY
Weekly Report
Issue - 2014 Week 19
5th to the 12th of May, 2014
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
2
From:
TIMMINT Market Intelligence
To:
Whom it may concern
Subject:
Weekly Report, Luxury industry
Issue Year 2014, Week 19
Report Sections
Global Luxury News
Stock Market Performance
Companies Stock Charts
Who We Are
The TIMMINT Group is specialized in providing professional services to the
worldwide business community.
This report was prepared as an account of work sponsored by the
Company. Certain information has been obtained from published
sources and is given as of the dates specified. All the information in this
publication is verified to the best of the authors’ and publisher’s ability,
but neither the company nor the Management Team makes any
warranty, express or implied, or assumes any legal liability or
responsibility for the accuracy completeness or the results of such use
of the information. All such information is subject to change without
notice.
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TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
3
Global Luxury
News
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
4
Luxury means you need to own it to be satisfied
Study finds respondents who were able to keep the luxury versions of the products they tested were more
satisfied with life.
What makes you feel more happy: Your affluent buddy allows you to take that box of foreign-brand
chocolates home or just lets you taste one when you visit his/her place? Researchers have just
read your mind.
According to a new study, ‘feel good’ factor is higher when you own, not just use, luxury
items. “Just using an affordable luxury item you do not own can, in fact, dampen the feel good
factor that normally surrounds such products,” said Liselot Hudders and Mario Pandelaere
from Ghent University in Belgium.
To test the link between luxury consumption and well-being, the researchers presented 307 study participants
with luxury and ordinary versions of either a durable pen or a chocolate box. The respondents who were able
to keep the luxury versions of the products they tested were more satisfied with life than the participants who
received the low-budget versions.
On the other hand, the well-being of participants who could
not keep the luxury versions they evaluated was significantly
lower than that of respondents who evaluated the plain
versions. Another interesting finding from the non-ownership
category is that these participants were significantly more
satisfied with their life after using the chocolate than after
using the pen.
“The finding that people are more satisfied with life when they own luxury products than when they only get
to use them is in line with prior research that equates consumption with ownership,” Hudders said. “In
contrast, the mere use or mere knowledge of luxury products seems to be detrimental for one’s satisfaction
with life,” Hudders noted.
Source: Gulf News
Own! Don’t
just use
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
5
Market Pulse | Upbeat Results
The Savigny Luxury Index (“SLI”) leaped by 3.5 percent last month, as the feel-good factor returned to the luxury sector, underpinned by strong results announcements and positive market reaction to repositioning strategies.
The Savigny Luxury Index (“SLI”) leaped by 3.5 percent last month, outperforming the MSCI World Index
(“MSCI”) by five percentage points. Most of the SLI components have had impressive increases this month as
the feel-good factor returns to the luxury sector, underpinned by strong results announcements and positive
market reaction to leading groups’ repositioning strategies.
Big news
• LVMH’s repositioning of its core brand Louis Vuitton is starting to pay off, which has had a boosting effect on
the whole sector. The group posted much higher than expected fashion and leather sales in its first quarter
results, propelled by creative momentum at Vuitton. Gucci continued its upmarket repositioning with flat
sales in the quarter being affected by the clean-up of its wholesale network. Nevertheless, Kering’s luxury
division posted an impressive sales increase of over 6 percent for the quarter, driven by star brand Bottega
Veneta and a much re-invigorated Saint Laurent. The group announced a re-organisation of its luxury division
into three groups: Gucci, Couture & Leather Goods and Watches & Jewellery. Mulberrry reversed its
upmarket strategy to revert to doing what it does best — affordable luxury handbags.
• The sector benefitted from a short-term sales rush in Japan as Japanese consumers rushed to the shops in
anticipation of VAT hikes. Hermès benefitted greatly as Japan is still its biggest market: the group posted
forecast-beating first quarter results. LVMH saw its revenues in Japan rise by over 30 percent (in local
currency) over the quarter.
• Currency movements continue to eat into the sector’s bottom line. Burberry saw strong progress in its sales,
up almost 20 percent in the first half, but warned again that currency headwinds would affect this year’s
results and could have a material impact on 2015 results. Luxottica, which makes over half its sales in North
America, said currency volatility has shaved more than five percent off reported revenue for the first quarter.
Kering expressed concern over the Ukraine crisis’ impact on the rouble: its menswear brand Brioni generates a
fifth of its sales from Russian clients.
• Italian brands continue to be the focus of M&A activity. Versace agreed a 20 percent capital increase to
Blackstone, whilst Cavalli looked to be sold to Permira for Eur450 million. In other news, Labelux announced
its intention to float Jimmy Choo this autumn.
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
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Going up
• Most of the SLI components have recorded high single digit monthly increases fuelled by good quarterly
results.
• Estée Lauder recorded the highest increase with a 8.5 percent jump as the beauty sector gets investors
attention following Elizabeth Arden bid rumours.
Going down
• The big loser this month is Coach whose share price tumbled over 10 percent after it posted a 21% plunge in
its third quarter sales in North America, its main market. The brand continues to lose ground to fast-growing
rival Michael Kors.
• Other US stocks such as Ralph Lauren (down almost 6 percent) and Michael Kors (down over 2 percent) have
suffered as investors anticipate the effects of the tapering of the Fed’s quantitative easing.
What to watch
Men are getting more attention than they ever have! According to a Bain study, menswear is the fastest
growing category in fashion and is set to continue growing at a faster rate than womenswear globally. Men
are already the dominant purchasing power in emerging markets and menswear is becoming as important a
category as womenswear in developed markets. Leading groups LVMH and Kering are focusing on this
category with their investments in Berluti and Brioni respectively, whilst predominantly menswear brands
such as Kiton, Tom Ford and Zegna have been growing at stellar rates. Prada has announced this month that it
aims to almost double its menswear sales to €1.5 billion over three to five years and open more dedicated
men’s shops.
Source: The Business of Fashion
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
7
How luxury has become a competitive tool for airlines
For most travelers, flying in style may be a thing of the past, but airlines are determined to bring back some
glamour to air travel, at least for those sitting in the front of the plane.
Flat beds and fluffy pillows, fancy wines and four-course meals, designer-brand pajamas and luxurious vanity
kits, these options have become the staple of business-class travel these days.
And after a couple of sluggish years, business travel spending in the United States is forecast to grow by 7.1
per cent to $293 billion in 2014, according the Global Business Travel Association. Spending on international
travel is expected to increase almost twice as fast, at 13 per cent, to reach $37 billion.
"Corporate passengers are definitely being fought over
by all the airlines," said Claudia Sender, the chief
executive of TAM Airlines, the Brazilian carrier. "They
have never been so important because of their
willingness to pay more."
Airlines have always treated their business-class passengers a little better than the rest. But in today's era of
mass travel, the extra attention to the front of the cabin has increased disparities in the air as never before.
"The gap between what's going on at the front of the plane and in the back has never been wider," said Tim
Winship, publisher of the FrequentFlyer.com website. He added: "If you're one of the lucky few who flies first
or business class these days - it's as good as it's ever been. It's all about profitability.
Given the disproportionate contribution from high-yield customers, it would be financially irrational for the
airlines not to take this into consideration."
Airlines typically charge six to eight times as much for business class as for coach on long-haul, international flights, and two
to three times as much for first class as for business class. For a passenger booking a month in advance, Cathay Pacific, for
instance, can charge $900 for a round-trip economy ticket from Los Angeles to Hong Kong, $6400 in Business class, and nearly
$16000 in first class.
Source: The Times of India
Business travel spending in
U.S. to grow by 7.1% to $293
billion in 2014
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
8
Mercedes-Benz betting big on Punjab market
Having recorded an impressive growth of 40 per cent in Punjab in the last calendar year, German luxury
carmaker Mercedes-Benz is betting big on Punjab market.
As part of its strategy, the company has further strengthened its presence in the state by inaugurating the
state’s largest luxury car dealership in Mohali near Chandigarh. Currently, the company has its dealership in
Chandigarh, Ludhiana and Jalandhar in Punjab.
The state contributes seven per cent of the company’s total national sales. Last
calendar year, the company sold 9003 units across India, a growth of 32 per cent
over the previous year. The Punjab market grew by 40 per cent during the period,
clearly indicating that the state has immense potential for the car
maker. Also, in the first quarter the current year, the Punjab
market seems to be in sync with company’s national sales
growth of 27 per cent.
With establishment of the state-of-the-art 3S facility at Mohali, Mercedes-Benz India
now enjoys a network spread across 36 cities with 64 outlets and retains the
distinction of being the leading luxury car manufacturer with the widest and most
qualitative network of sales and after-sales services.
A total of 11 new outlets are planned for 2014 of which four outlets have already been inaugurated including
Mohali and remaining are scheduled during the year.
Meanwhile, the company also commenced its Grand Tour of the award winning vehicles comprising the A-
Class, E-Class, B-Class and GL-Class on Monday. This convoy of gold foiled cars will be visiting 23 cities across
India in next 45 days as part of Mercedes-Benz India’s ‘Celebrate Excellence’ campaign. The convoy will also be
visiting Karnal, Chandigarh, Ludhiana and Jalandhar to celebrate the excellence of the Three Pointed Star.
Source: Business Standard
9003 units sold
across India in
2013
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
9
Stock Market
Performance
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
10
Top Luxury Companies by market Cap
The table below shows the top 20 luxury companies by Market Cap listed in the stock markets and
their weekly percentage change at the closing stage of this week:
# Company Name
Market Cap (12th of May) (USD billion)
Market Cap (5th of May) (USD billion)
% Change
1 Lvmh 98.86 99.44 -1%
2 Daimler 97.6074 98.3147 -1%
3 Diageo 77.2524 77.8122 -1%
4 Nike 64.1 64.1 0%
5 Christian Dior 36.915 37.113 0%
6 Hermes 36.846 37.0435 -1%
7 Porshe automobile 33.44 33.44 0%
8 Pernod Ricard 31.5606 31.831 -1%
9 Estee Lauder 28.04 29.34 -4%
10 Kering 27.1722 27.8139 -2%
11 Luxxotica 26.703 27.1745 -2%
12 Tesla motors 26.16 26.16 0%
13 Prada 20.8897 20.8897 0%
14 Harley Davidson 15.99 15.99 0%
15 Ralph lauren 14 14 0%
16 Beam 13.8 13.8 0%
17 Lindt & Spruengli 12.7512 12.5517 2%
18 Coach 12.18 12.18 0%
19 Nordstrom 11.76 11.76 0%
20 Tiffany 11.51 11.39 1%
The below graph shows the top 5 companies
that had the highest increase in market cap
(last week):
The below graph shows the 5 companies that
had the highest decrease in market cap (last
week):
2% 2% 2%
1% 1%
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
11
The table hereunder shows the top 15 luxury companies by P/E ratio and their weekly percentage
change last week:
# Company Name P/E Ratio (12th of May) P/E Ratio (5th of May) % Change
1 Yoox spa 116.86 116.86 0%
2 Group FNAC 38.72 38.72 0%
3 Blue Nile 37.29 37.29 0%
4 Luxxotica 35.35 35.88 -1%
5 Hermes 33.33 33.33 0%
6 Beam 33.22 33.22 0%
7 Harman International 29.55 29.55 0%
8 PVH corp 28.24 27.8 2%
9 Shiseido 27.65 27.65 0%
10 Remy cointreau SA 27.43 27.43 0%
11 Treasure wine estates ltd 26.8 26.8 0%
12 Estee Lauder 26.54 28.43 -7%
13 Tempur sealy international inc 26.34 26.34 0%
14 Salvatore ferragamo 25.56 25.56 0%
15 Polaris Industries 24.71 24.71 0%
T A K E A B R E A K
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
12
Laser lighting has several advantages over traditional LED headlights, the first of which is better range in the high-beam mode. The
R8 LMX, which has LED headlights for normal daytime use, has laser headlights that are activated at speeds of over 60km/h to
enhance visibility and thus improve safety.
A system of sensors and cameras allows the car to detect the presence of an oncoming car and to adjust the position of the headlights
to avoid blinding other drivers.
A combination of LED and laser headlights is also featured on the Audi R18 e-tron, which will become the first car with the
technology to compete in the Le Mans 24 Hours Race (June 14-15).
Under its aluminum body, the Audi R8 LMX packs a 5.2-liter V10 engine with up to 570hp. The sports car boasts 0 to 100km/h
acceleration in just 3.4 seconds and can reach a top speed of around 320km/h. The vehicle's fuel consumption averages 12.9 liters per
100km, or 299g/km of CO2 emissions.
Produced in a limited edition and exclusively in blue, the Audi R8 LMX is expected to go on sale sometime this summer. Prices have
not yet been announced, although they will likely exceed $275,000.
Audi launches first production car
with laser lights
Source: Times live
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
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8.08
6.44
5.38 4.99
3.80 3.76 3.58 2.74 2.63
1.95 1.91 1.54 1.50 1.27 1.24
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TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
14
COMPANIES STOCK
CHARTS
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
15
Top 12 Luxury Companies Charts
The charts below reflect the index movement of the top 12 companies that had the highest market cap
during this week:
Price Change
Begin High Low End Value %
172.6 203.23 154.95 194.51 21.91 13%
* One year data *Market: US * Currency: US Dollar
Price Change
Begin High Low End Value %
43.78 71.27 43.02 64.55 20.77 47%
* One year data *Market: France * Currency: Euro
Price Change
Begin High Low End Value %
24.79 25.4 21.23 22.71 -2.08 -8%
* One year data *Market: France * Currency: Euro
Price Change
Begin High Low End Value %
64.51 80.26 59.11 73.45 8.94 14%
* One year data *Market: US * Currency: US Dollar
Price Change
Begin High Low End Value %
136.283 149.26 121.28 145.78 9.497 7%
* One year data *Market: France * Currency: Euro
Price Change
Begin High Low End Value %
93.882 95.92 78.78 86.19 -7.692 -8%
* One year data *Market: Germany * Currency: Euro
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
16
Price Change
Begin High Low End Value %
174.2 185.15 136.95 156 -18.2 -10%
* One year *Market: France * Currency: Euro
Price Change
Begin High Low End Value %
70.71 76.24 63.63 73.24 2.53 4%
* One year *Market: NYSE * Currency: US Dollar
Price Change
Begin High Low End Value %
7.8 11.24 7.25 10.6 2.8 36%
* One year *Market: US * Currency: US
Price Change
Begin High Low End Value %
40.93 42.97 35.22 40.47 -0.46 -1%
* One year data *Market: Italy * Currency: Euro
Price Change 34 194.5 32.85 138 104 306%
Begin High Low End Value %
80.99 265 78.11 182 101.01 125%
* One year *Market: US * Currency: US Dollars
Price Change
Begin High Low End Value %
266.5 283.2 223.95 256.5 -10 -4%
* One year *Market: France * Currency: Euro
TIMMINT MARKET INTELLIGENCE LUXURY WEEKLY REPORT 5th
to 12th
of May 2014
17
Office – LEBANON