(Bloomberg) -- Billionaire Bernard Arnault said his luxury conglomerate LVMH is witnessing encouraging signs of a recovery, though it will be gradual.
“The signs of recovery in June are quite vigorous in some activities,” the company’s chairman and chief executive officer said at Tuesday’s annual meeting of shareholders, which was held online only due to the pandemic.
The luxury industry is emerging from one of the worst starts to the year after strict population lockdowns led to sharp drops in sales of luxury goods that range from Louis Vuitton handbags to Champagne bottles.
The coronavirus pandemic will “continue to weigh in coming months,” Chief Financial Officer Jean-Jacques Guiony added, although the group stopped short of providing more precise financial estimates of the damage. LVMH is set to report second-quarter earnings in coming weeks.
The company’s shares rose as much as 1% in Paris. They’re down 5.8% this year after a 60% surge in 2019.
“We can only hope that the recovery will be gradual during the second half,” Arnault said.
A rebound is crucial to LVMH, which is set to conclude its $16 billion acquisition of iconic U.S. jeweler Tiffany & Co. this year.
“Tiffany is one of the most emblematic jewelry brands and it has its place in the LVMH portfolio,” LVMH Managing Director Antonio Belloni said during the meeting, responding to a question. Investors have speculated LVMH might try to renegotiate the deal.
Arnault is the world’s third-richest person with a net worth of $87.8 billion, according to the Bloomberg Billionaires Index.
Separately, 82.9% of LVMH shareholders approved Arnault’s 2019 remuneration. Proxy advisors Institutional Shareholder Services Inc. and Glass Lewis & Co. had both recommended that investors reject Arnault’s 2019 pay, citing the decision to grant him stock awards to Arnault, who owns 63% of LVMH’s share voting rights.
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